Unconventional Economist

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CBA: Restoring mass immigration would hurt workers

CBA’s head of Australian economics, Gareth Aird, has warned policy makers against restoring the mass immigration program, arguing that it would lower workers’ wages and lower livability by congesting economic and social infrastructure: “With international borders closed, there is a greater chance wages growth may accelerate,” said Gareth Aird… “When you have skills shortages pop

3

Labor backs federal anti-corruption commission

In last night’s Budget reply speech, opposition leader Anthony Albanese stated that a Labor Government would establish a National Integrity Commission (NIC) to investigate corruption across the federal bureaucracy: Over these 8 long years the Government has focussed on itself, too often treating taxpayers money as if it were the Liberal and National Parties money.

6

Employment Minister: Trust us on wage growth

The Morrison Government is under attack after the federal Budget forecast zero real wage growth for the next three financial years: Today, Employment Minister Stuart Robert has sought to assure Australians that wage growth will come once unemployment drops: “Wages growth will always come hand-in-hand with inflation and low unemployment,” Mr Robert told the ABC.

18

Labor launches piss weak public housing plan

Housing policy was a key focus of the Budget reply speech of Labor leader Anthony Albanese. Albanese committed to establishing a Housing Australia Future Fund to build 30,000 affordable homes, as part of a $10 billion social housing package. The proposal would effectively give the Future Fund $10 billion, which would then use the earnings

12

RBA schools Treasury on immigration’s growth impact

One of the most striking omissions from Tuesday night’s federal budget was that it made zero mention of Australia’s per capita GDP outlook. As we know, per capita GDP is a far superior measure of welfare (albeit still highly flawed) than headline real GDP, since it adjusts for the impact of population growth. After all,

4

Net overseas migration moves further into negative

The Australian Bureau of Statistics (ABS) has released Overseas Arrivals and Departures data for March 2021, which confirmed that net migration into Australia remains firmly negative. There were 23,560 net permanent & long-term departures in the 12 months since the beginning of the pandemic in March 2020, representing the first time that net arrivals have

13

The Australia Institute demolishes skills shortage myth

The Australia Institute’s Richard Denniss and Matt Grudnoff have demolished the notion that Australia is experiencing chronic skills shortages, given there are nearly two million Australians unemployed or underemployed (video below). They argue that if businesses want to attract workers there is a simple solution: 1) pay workers enough to make their unattractive jobs more

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Links 14 May 2021

Global Macro / Markets / Investing: Private Investors and VCs Flock to Crypto and DeFi As the Bull Run Rages On – ib Times Blockchain platforms are hyped, but what actually is possible & being done with the technology? – BTC Manager ‘Champions League of tax avoidance:’ Uber used 50 Dutch shell companies to dodge

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China to drop trade war hammer on international students

The CCP trade war on Australia is a sight to behold. It has already delivered Australia a reinvigorated ANZUS, and iron ore led income boom, and the very accelerated export decoupling that we desperately needed but couldn’t do owing to CCP’s corruption of local politicians and businesses. In February, Beijing identified the collapse of Australian

5

FWO misses out on bureaucrat spending boom

The May 2021 Budget papers show that the ranks of the federal public service will swell to 174,300 in 2021-22, with almost 5,400 new staff to be recruited during the coming financial year. Government agencies that are taking on additional staff include the Australian Commission for Law Enforcement Integrity, which will grow from 64 to

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SEEK job ads smash records in April

OVERVIEW OF APRIL 2021: STATE OF THE NATION: April is the second consecutive record-breaking month of job ads posted in SEEK’s 23+ year history. Applications per ad are at the lowest level since 2012. SEEK job ads were up by 11.9% month-on-month (m/m). SEEK job ads were up 263.7% year-on-year (y/y) and up 30.9% compared

4

New Home Sales fall back to earth

New home sales are falling back to earth after the expiry of the HomeBuilder subsidies, according to the HIA: “New Home Sales fell in April 2021 to be 54.4 per cent lower than March as HomeBuilder came to an end,” stated HIA’s Economist, Angela Lillicrap… “This sales result for April 2021 is an encouragingly strong

10

NZ property prices decline after investor tax changes

In March we witnessed two key reforms come into effect designed to take the steam out of New Zealand’s inflating property market. First, the Reserve Bank of New Zealand (RBNZ) reintroduced loan-to-value ratio (LVR) mortgage restrictions, which from 1 March 2021 required both investors and owner-occupiers to hold bigger deposits: Second, and more importantly, the New Zealand

24

Safe as Brisbane houses

If I had to pick the safest major capital city market to purchase an investment property, I would choose to buy a detached house in Brisbane. My reasoning is straightforward. First, Brisbane’s relative cost against Sydney and Melbourne is running near the lowest level in almost 50 years. As shown in the next chart, a

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Industry shills demand migrant workers

The travelling circus of industry shills begging for a return of ‘Big Australia’ immigration rolls on, with Michael Stutley – partner at Kingston Reid – penning an advertorial in The AFR claiming that Australia’s “social and economic success” is at risk unless we bring back so-called skilled migrants: It [skilled migration] needs to grow. Sharply.

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Sydney property prices have gone vertical

Sydney property prices continue to soar into the stratosphere. According to CoreLogic’s daily dwelling values index, Sydney dwelling values have already surged an extraordinary 10.6% this calendar year with prices already up 1.2% in May: Price momentum also appears to be growing. Quarterly dwelling value growth is running at 9.3%, which is the strongest growth

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Links 13 May 2021

Global Macro / Markets / Investing: Stanley Druckenmiller says the Fed is endangering the dollar’s global reserve status – Forex Factory Why Stocks Soared While America Struggled – VOX S&P closes down in broad sell-off fueled by inflation fears – Reuters Ethereum, Soars Above $4,000 For the First Time Showing No Signs of Slowing Down

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Federal budget: Increasing home ownership on the Coalition’s terms

CoreLogic’s head of research, Eliza Owen, has released a note explaining the federal budget’s housing policy changes: Housing affordability is becoming an increasing concern for first home buyers and policy makers amid recent, rapid price increases. But the double-edged sword of reducing housing values to make them more affordable, is that housing also makes up

16

Academics: Frydenberg turns Australia into “guest worker state”

Stephen Clibborn and Chris F. Wright from the University of Sydney have attacked Josh Frydenberg’s decision to uncap international students’ work hours across hospitality and tourism, claiming that it will create a “guest worker state” that will push wages and working conditions lower: Our research shows it [the decision] is consistent with a troubling 25-year

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Bloated superannuation sector to expand following Budget

Australia’s bloated superannuation sector was a major beneficiary of last night’s federal budget. Not only did the budget keep the scheduled rise in the superannuation guarantee (SG) to 12% in place, but it also: removed the current $450 per month minimum income threshold for the superannuation guarantee; removed the work test for older Australians to

26

Gotti panics over impending “wages explosion”

According to Robert Gottliebsen, the collapse in immigration is about to send wages into the stratosphere and force employers to invest in labour saving technology. Therefore, Australia quickly needs to reboot immigration to ward off wage rises: Australia should prepare for much higher wage and salary pressures… I was talking to professional services firms including

1

Treasury has no idea on wages

It is clear from last night’s federal budget that the Australian Treasury has no idea on wages. For years we watched the Treasury make bullish predictions on wage growth, always forecasting a marked pick-up in wages over the forward estimates period: This bullishness came despite the federal government running one of the biggest immigration programs

4

Rental vacancies tightest in 8 years

SQM Research has released its rental vacancy data for April, which reports a national rental vacancy rate of only 1.9% – the lowest level of vacancies since March 2013. Rental vacancies are zipped tight everywhere except Melbourne and Sydney, which have been hit hardest by the loss of international students, as illustrated clearly in the

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Judith Sloan demolishes ‘Big Australia’ carpetbaggers

The Australian’s Judith Sloan, a former commissioner at the Productivity Commission, has demolished the vested interests pushing for a quick return to mass immigration. In summary: Supporters of a ‘Big Australia’ include the property sector, universities and other educational institutions, and federal Treasury. These organisations never consider the downsides of high immigration levels, including lower