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The Australian economy has always ridden on the consumer’s back.
Household consumption has historically accounted for around 55% of Australia’s final demand (see next chart). Therefore, ebbs and flows in household consumption is the key swing factor determining whether the economy grows (and by how much) or shrinks.
Household consumption makes up more than half of Australia’s economic growth.
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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness.
Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.
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