The Australian Bureau of Statistics released the latest – Australian National Accounts: National Income, Expenditure and Product, September 2022 – today (December 7, 2022), which shows that the Australian economy grew by 0.6 per cent in the September-quarter 2022 and by 5.9 per cent over the 12 months to the end of September 2022. Growth is being driven largely by continued growth in household spending (which has not yet succumbed to the cost of living squeeze exacerbated by the interest rate rises). There was a modest contribution from private capital formation. The terms of trade declined sharply signalling a negative contribution from net exports and declining real net national living standards. There was growth in employee compensation (the wage measure from the national accounts) of 3.2 per cent but that was largely due to administrative decisions (for example, minimum wage increases) that impacted in this quarter rather than being the result of market pressures.

The Australian Bureau of Statistics released the latest – Australian National Accounts: National Income, Expenditure and Product, June 2022 – today (September 7, 2022), which shows that the Australian economy grew by 0.9 per cent in the June-quarter 2022 and by 3.3 per cent over the 12 months to the end of June 2022. Growth is being driven by a combination of household spending (which has not yet succumbed to the cost of living squeeze exacerbated by the ridiculous interest rate rises) and a booming export sector (on the back of strong terms of trade). The problem is that while the on-going productivity growth has provided scope for non-inflationary real wage rises, real wages are going backwards. The problem is that business are pocketing these productivity gains as profits. The wage share fell further to a record low of 48.5 per cent which is a shocking testimony of the way the wages system is penalising workers. That needs to stop and the government should do something about it.

The Australian Bureau of Statistics released the latest version of – Private New Capital Expenditure and Expected Expenditure, Australia – today (May 26, 2022), which is part of several releases leading up to the publication of the June-quarter National Accounts next Wednesday. Today’s business investment data shows that private new capital expenditure in Australia fell by 0.3 per cent in the March quarter but was up by 2.2 per cent on the year. This is the second successive quarter in which business investment has fallen and it is likely the September-quarter will also record a contraction, which will all but wipe out the positive annualised result. This is the Australian business community at work – they are enjoying massive cuts to real wages for their workforces, record levels of profits, a rising profit share – and their investment performance is pathetic. There is some tension in the data though – as the expectation series indicates business investment growth over the next 12 months. I think that is overly optimistic given that household expenditure is likely to slow down with the rising interest rates and high energy prices really squeezing low-income families. One of the challenges facing the new Federal government is to somehow convince the business community to change their behaviour in this respect. Good luck with that. The way that the business sector has hijacked the ‘Jobs and Skills Summit’ agenda to turn it into a justification for more skilled migration – which will further dampen wages growth, push up unemployment, and further strain the almost impossible rental and home market – is evident that they are not for changing. And, if the new Treasurer keeps harping on about the $A1 trillion debt and the need to cut the fiscal deficit we will sink into recession.

The Australian Bureau of Statistics released the latest – Australian National Accounts: National Income, Expenditure and Product, March 2022 – today (June 1, 2022), which shows that the Australian economy grew by 0.8 per cent in the March-quarter 2022 and by 3.3 per cent over the 12 months to the end of March 2022 – a decline in the growth rate. Nominal GDP grew by 10.2 per cent over the year and the change in the GDP price index (a measure of inflation) was 8.2 per cent. The data tells us that after the initial rebound from the lockdowns, growth moderated in the March-quarter and was driven by domestic demand – household consumption, government spending and inventory accumulation. The external sector undermined growth even though the terms of trade boomed. Productivity growth was strong but note working hours fell. The productivity growth provided scope for non-inflationary real wage rises. The problem is that business are pocketing these productivity gains as profits. That needs to stop and the government should do something about it. The wage share fell below 50 per cent which is a shocking testimony of the way the wages system is penalising workers.

Today (March 2, 2022), the Australian Bureau of Statistics released the latest – Australian National Accounts: National Income, Expenditure and Product, December 2021 – which shows that the Australian economy reversed the contraction in the September-quarter 2021 and posted an annual growth rate of 4.2 per cent. Covid lockdowns and restrictions caused the contraction and their abandonment allowed for growth to return. Growth was driven by strong growth in household consumption expenditure as public fiscal support declined and private investment expenditure went backwards. The change in the terms of trade was negative reflecting the rising import prices as supply constraints continue and demand rises. Overall, a good result but the next quarter will be much less robust (floods etc).

Today (December 1, 2021), the Australian Bureau of Statistics released the latest – Australian National Accounts: National Income, Expenditure and Product, September 2021 – which shows that the Australian economy contracted 1.9 per cent in the September-quarter. The annual growth rate of 3.9 per cent is relatively meaningless given the base was severely affected by the lockdowns last year. The decline in economic activity was driven by private demand, which contracted by 2.4 percentage points – mostly due to a decline in household final consumption expenditure. Public spending contributed 0.7 points to the GDP figure thus attenuating, to some extent, the fall in private demand. The increase in spending on health by both Federal and State governments was not large enough to avoid the contraction though. Real net national disposable income fell by 3.8 per cent, but rose by 7.8 per cent over the year. GDP per capita fell by 2 per cent in the September-quarter. There was a massive boost in the household saving ratio (from 11.8 per cent to 19.8 per cent) as a result of the tight lockdowns in Victoria and NSW during this period as a result of the renewed fiscal support. We will have to see how the rebound is next quarter now that the restrictions have been significantly eased. The most worrying thing about the data today is that the wage share in national income slumped further while the profit share in a smaller pie rose. Something needs to be done about that.