Real household disposable income continues to fall

By Leith van Onselen

The March quarter national accounts was another shocker for Australian households.

According to the ABS, the real average compensation per employee fell by 0.3% in the year to March 2018 to be 3.8% lower since March 2012:

Late last week, the Reserve Bank of Australia (RBA) also released real household disposable income (HDI) data, derived from the March quarter national accounts, which revealed that real per capita HDI fell by 0.2% over the quarter and was down by 0.4% over the past year.

The below chart tracks quarterly real per capita HDI:

As you can see, quarterly real per capita HDI has fallen by 0.5% since June 2012!

Below is the same chart presented on a 4QMA basis:

Here, real per capita HDI fell by 0.9% in the year to March 2018 and has fallen by 0.3% since June 2012.

To add further insult to injury, the growth in real per capita HDI so far this decade remains anaemic at just 0.62% per annum, which is lower than the 1960s (2.34%), 1970s (1.86%), 1980s (0.90%), 1990s (1.30%), and 2000s (3.18%):

Just another indicator of Australia’s ‘lost decade’ in the making.

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Unconventional Economist

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