Inside the changing ethics behind retail’s crime epidemic

Amid the harsh arithmetic of the cost-of-living crisis, a cultural crisis is unfolding in parallel, focusing less on household budgets and more on moral bandwidth.

Retail trade may have climbed 4.9 per cent year-on-year, and consumer confidence may be nearing pre-pandemic levels, but theft is now at a 21-year high. 

According to the Australian Bureau of Statistics, almost half of all theft incidents last year – an estimated 268,000 cases – occurred in retail settings.

Behind these numbers lies a recalibration of what Australians, especially the younger generation, deem justifiable.

The moral economy

Monash Business School’s Australian Consumer and Retail Studies (ACRS) recently released its Consumer Deviance Spotlight, a study examining shoppers’ attitudes toward theft, “soft deviance,” and shopping centre safety. 

What it revealed was centred around legitimacy. More than a quarter of consumers viewed overt retail theft as “a little to completely justifiable”. 

That figure rose even higher when the behaviour felt procedural rather than criminal, for example, not scanning an item at self-checkout (32 per cent), scanning it as something cheaper (36 per cent) or changing a price tag (30 per cent).

There’s no denying that shoppers experience a subtle tension at the self-service checkout, with some customers feeling anxious or self-conscious under heightened surveillance.

This uneasy dynamic between autonomy and oversight mirrors the cultural push-and-pull at the heart of retail’s moral economy.

According to Stephanie Atto, research and strategy director at ACRS, this generational leniency isn’t random but cultural.

“Cross-national research in Europe also found younger age groups judged deviant behaviours more leniently,” she explained to Inside Retail. 

“Interestingly, this effect was stronger in societies that had greater individual flexibility and tolerance of deviance. In other words, these age differences occurred more in loose-knit societies.”

Australia, Atto noted, ranks high on that individualism scale 

“A highly individualistic and loosely-knit society with a score of 90 out of 100, just behind the United States,” she said. 

The implication is that a culture that prizes independence may also erode collective accountability. 

“Changing macro factors, like culture, is no small feat,” she conceded, “but education or engagement that aims to create tighter-knit communities may be a step in the right direction.”

Outright theft reveals one axis of moral drift, yet “soft deviance”, manipulating promotions, misleading staff and gaming loyalty systems, exposes another.

“Motivations for deviant behaviours can be due to a wide range of reasons,” said Atto. “The cost-of-living crisis is ongoing, and Aussies may be looking to save money, and digital normalisation allows shoppers to act with greater anonymity and impunity.”

But beyond economics or technology lies psychology. “Consumers use neutralisation techniques to rationalise wrongdoing,” she explained. “For example, consumers who fraudulently seek compensation may deny there is a victim, or consumers who fraudulently return products may deny that it is harming anyone or that their good behaviour outweighs this indiscretion.”

This self-forgiveness mechanism of ethical inflation mirrors how moral value depreciates under pressure. A consumer who once viewed deception as theft may now frame it as “a savvy hack.”

The paradox of surveillance

Globally, UK supermarkets have begun trialling “security pods”, portable surveillance towers equipped with cameras, motion sensors and sirens, originally designed for construction sites. 

According to The Times, Early results showed a 49 per cent reduction in shrinkage and a 50 per cent drop in antisocial behaviour, highlighting how visible deterrence is being used to restore trust on the shop floor.

Retailers, for their part, are responding with layers of digital fortification, including AI-driven checkout verification, ID scanning, exit gates and in some cases, facial recognition. 

The flip side of that coin is that technology designed to prevent deviance can also amplify distrust.

Atto cautions that how these tools are perceived is as crucial as how they perform. 

“Consumers may find the preventative measures listed to be reasonable to mitigate loss. However, consumers feel differently about preventative measures that make them feel they are being unfairly monitored or targeted by surveillance measures,” she said.

She cites Bunnings’ backlash over facial recognition, criticised for collecting personal and sensitive information without consent and Woolworths’ use of disguised staff to monitor customers.

In August last year, the Australian Privacy Commissioner ruled that Kmart had violated the Privacy Act after using facial recognition technology in stores from June 2020 to July 2022. 

Kmart’s surveillance system, intended to detect refund fraud, was found to have unlawfully captured biometric data from all customers without their consent.

With the above context noted, retail’s paradox still comprises a trust economy that must enforce suspicion to survive.

The safety mirage

Despite the record crime rates, most shoppers still report feeling safe in shopping centres. It’s a perception gap that says as much about exposure as it does about denial.

“According to our survey, only one in four shoppers visit shopping centres more than once a week, while the majority visit once a week or less,” Atto explained. 

“Additionally, less than half (42 per cent) witnessed any concerning behaviours … the most common behaviours were loitering (26 per cent) and disruptive groups (15 per cent).”

Retail workers, however, occupy a different reality. 

“Based on other ACRS research that focuses on the perspective of retail staff, safety and security is a key issue being raised by this group,” she said. 

“This is unsurprising as retail staff are at shopping centres on a daily basis and may witness or be the victims of increasing retail crime.”

Retail crime is not just an economic issue but a mirror of collective ethics and perhaps most of all a reflection of how value, fairness and community have shifted under the weight of inflation and individualism.

Atto believes the solution may not lie in tougher enforcement, but in re-stitching community connection. 

“Across other research that ACRS conducts, we often hear from shopping centre retailers asking their landlords for more community-focused events to strengthen local engagement,” she said. 

“Shoppers who are more engaged with their local retailers may be less lenient on retail crime in their area.”

Australia’s retail crime wave is both a symptom and a signal of economic strain, but also of cultural looseness, where autonomy eclipses accountability. The crisis may not be moral panic so much as moral fatigue and a slow erosion of the social contract between consumer and retailer, citizen and community.

The question for retailers is now how to rebuild meaning, design systems, spaces and experiences that make people want to play fair.

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