Unconventional Economist


Job postings strong ahead of ABS employment release

Indeed economist Callam Pickering has updated his Australian job postings series, which tracks the level of job postings since the beginning of the pandemic. According to Pickering, Australian job postings are tracking were tracking 45.5% higher than their pre-pandemic level as at 11 June; although the level of postings has stabilised: Despite Victoria’s latest hard


Contradictory employers cry foul at 2.5% minimum wage increase

For months we have witnessed Australia’s employer groups lobby the federal government for easier access to foreign workers due to purported crippling labour shortages. However, when it comes to actually paying more to attract Australian workers into their respective industries, they are firmly opposed. In the lead-up to yesterday afternoon’s minimum wage decision by the


Links 17 June 2021

Global Macro / Markets / Investing: The Fed Cannot Control Its Easy-Money Monster – NY Times World’s Bubbliest Housing Markets Flash 2008 Style Warnings – Bloomberg Stability of collusion and quality differentiation: a Nash bargaining approach – Bruegel Nobel Prize winning economist Muhammad Yunus says 2050 may be too late to save planet. – Yahoo


NZ property market powers past Ardern’s investor tax reforms

In March two key reforms came into effect designed to take the steam out of New Zealand’s fast 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


Net overseas migration stuck in negative

The Australian Bureau of Statistics (ABS) has released Overseas Arrivals and Departures data for April 2021, which confirmed that net migration into Australia remains negative. There were 23,290 net permanent & long-term departures in the 13 months since the beginning of the pandemic in March 2020, representing the first time that net arrivals have been


Trans-Tasman bubble boosts international travel

The introduction of the trans-Tasman travel bubble on 18 April 2021 has boosted international travel, according to new provisional travel statistics from the ABS. Arrivals of non-Australian citizens doubled in May to 71,060 from 35,210 in April: This was driven by a 32,000 increase in arrivals from New Zealand: In a similar vein, departures of


CBA: “Labour market tightening…wage growth forthcoming”

By Gareth Aird, head of Australian economics at CBA Key Points The ABS monthly labour force survey excludes overseas residents in Australia and therefore the survey has not accurately captured the impact of the international border closure on the labour market. The ABS quarterly labour account includes all people who contribute to Australian economic activity


OECD blames restrictive planning and zoning for expensive housing

The OECD has blamed Australia’s restrictive planning and zoning for driving the fourth sharpest property price increase in the developed world over the past 20 years: Paris-based OECD director of policy studies in the economics department, Luiz de Mello, said low interest rates had contributed to rising house prices. But restrictive regulations were also a


Morrison to green-light dedicated farm slavery visa

In March the federal government released a 327-page report from the National Agricultural Labour Advisory Committee, which explicitly admitted that the agricultural industry’s overreliance on cheap migrant labour is bad for productivity and unsustainable: Australia’s main competitors in agriculture are either ahead or running very close. In many ways, Australia is at a crossroads. Either its


Aussie housing values now four-times larger than economy

The ABS yesterday released its property price data for the March quarter, which valued Australia’s dwelling stock owned by households at $7.9 trillion, whereas the total housing stock was valued at $8.3 trillion. As shown below, the ratio of the dwelling stock owned by households against Australian GDP hit a record 4.0 times as at


Links 16 June 2021

Global Macro / Markets / Investing: Uneven vaccination rates are creating a new economic divide – The Economist The socio-economic consequences of COVID-19 in the Middle East and North Africa – Bruegel Walton Family, World’s Richest, Raises $2.1 Billion From Walmart Holdings – Yahoo Winners and Losers of the Work-From-Home Revolution – The Atlantic Wall


Business Confidence hits 7-year high

Roy Morgan’s business confidence survey hit a seven year high in May, increasing 4pts (+3.2%) to 129.3 – the highest reading since January 2014 (131.5). This follows a whopping 39.4pts (+43.8%) increase on May 2020 when Australia was gripped by the coronavirus pandemic: Business Confidence in May 2021 was 15.5pts above the long-term average of


Deloitte: Retail to ride wave of spending

Deloitte Access Economics is upbeat about the outlook for Australian retailers, forecasting that consumer spending will remain strong as the domestic economy continues to rebound and COVID-19 restrictions ease. The firm’s quarterly Retail Forecast report notes that lockdowns and travel restrictions have boosted retailers’ sales, which should result in a “bumper year” for the sector


Aussie farm visa slaves paid just ‘$9 a day’

Earlier this year, the National Farmers Federation (NFF) called for a Dedicated Agriculture Visa program ease purported chronic labour shortages across the sector: To provide a stable and sustainable workforce for agriculture that is fair and equitable for both workers and employers, the NFF supports the introduction of a Dedicated Agriculture Visa program… providing a


Productivity not population key to Aussie living standards

Former ALP minister Craig Emerson has penned an article in The AFR calling on the Morrison Government to tackle Australia’s declining productivity growth, which is central to boosting the nation’s living standards: “Productivity growth has contributed 95 per cent of the improvement in Australians’ material living standards since 1901”. “From the turn of the century,


Adair Turner exposes Treasury’s mass immigration myopia

Over the weekend, The AFR reported that the Morrison Government will use the Australian Treasury’s upcoming intergenerational report (IGR) as ammunition to reboot the mass immigration ‘Big Australia’ policy (see yesterday’s post). The IGR will reportedly “show the country is getting older, more indebted and reliant on taxing younger workers, and driving up spending”. Therefore,


Links 15 June 2021

Global Macro / Markets / Investing: The Profit Paradox’ Details How Lack Of Competition Warps Economies – Benzinga Will poorer countries benefit from international tax reform? – The Economist BlackRock isn’t to blame for the dumpster fire housing market – VOX Fed balance sheet tops $8 trillion for first time -data – Reuters US Treasuries


Auction clearances rebound on Melbourne reopening

CoreLogic’s preliminary report on the weekend’s auctions reported a higher clearance rate as Melbourne reopened. The national preliminary clearance rate rose to 77.4% from 73.5% the prior weekend. However, this was off significantly lower auction volumes, down to 1,426 from the prior weekend’s 2,691, owing to the Queens’s Birthday long weekend. Sydney continued its strong


Coalition, Treasury collude to reopen immigration floodgates

The Weekend AFR gave its strongest indication yet that the Morrison Government will use Treasury’s upcoming Intergenerational Report (IGR) as ammunition to reopen the mass immigration floodgates: This month’s Intergenerational Report will be “used to reinforce the government’s case to boost immigration once the pandemic ends”. “It will show the country is getting older, more


Queens Birthday Holiday Links 14 June 2021

Global Macro / Markets / Investing: Standard Inflation Theory Leaves Out Social Conflict and Costs – Ineteconomics Will poorer countries benefit from international tax reform? – The Economist BlackRock isn’t to blame for the dumpster fire housing market – VOX Fed balance sheet tops $8 trillion for first time -data – Reuters Global food prices


Weekend reading: 12-13 June 2021

Global Macro / Markets / Investing: Global food prices rise to highest level in a decade – Yahoo In a world first, El Salvador makes bitcoin legal tender – Reuters Inflation Is Surging. The Price Of A Toyota Pickup Truck Helps Explain Why – NPR The coming productivity boom – Bruegel Banks to Companies: No


Aussie university vice chancellors still grossly overpaid

Despite the cut in international students, salaries of university vice-chancellors remain bloated, according to new analysis by Fairfax: Unbelievably, some vice chancellors scored pay rises in 2020 at the same time as revenues tanked, rank and file staff were retrenched or had their wages stolen, and students were pushed into sub-standard online teaching. As shown