Australian Economy

By Leith van Onselen Australia’s Productivity Commission (PC) has long been opposed to strengthening Australia’s intellectual property (IP) rules.

There are not many authorities around the world that would be fretting about a lift their terms of trade but Australia is one of them.

From Macquarie Bank: Construction activity is likely to fall in 2Q16, but public infrastructure spending is rising. Earlier (1Q16) commencements data suggest some early signs of the long-awaited upswing in infrastructure spending.

By Leith van Onselen Senator Nick Xenophon has co-written an article today arguing that the RBA should abandon its 2%-3% inflation target in favour of a 5% nominal GDP growth target.

By Leith van Onselen Last week’s ABS labour force release for July revealed a further deterioration in trend unemployment for those aged 15 to 24 years old, with unemployment rising for the sixth consecutive month to 13.0%, versus 4.2% unemployment for the rest of the labour market (see next chart).

The east gas gouge rolls on but at least it was cheaper last week at home than it was in Japan as the local Winter squeeze winds down: However, the trend remains up and much higher volumes of gas are headed offshore yet.

So much for that part time jobs surge, from Peter Martin: Full-time employment has slid 64,500 since December while part-time employment has surged 136,600.

A quick addendum to my employment post on casualisation.

As I reported earlier, the ABS has released July Labour Force figures and the headline numbers were stronger than consensus with 26,200 jobs created versus 10k expected.

The ABS has released July employment numbers and the news is whacky: SEASONALLY ADJUSTED ESTIMATES (MONTHLY CHANGE) Employment increased 26,200 to 11,968,600.

Leading into today’s figures, here’s a negative taster: July unemployment rose 0.9% to 10.5% – nearly double the current ABS figure for June 2016 (5.8%). Now 1.365 million Australians (up 268,000 since July 2015) are unemployed.

The June QTR wage price index is out and is bumping along the bottom registering new trend lows in the quarter for both public and private sectors at 0.4% and 0.5% respectively.

From Westpac: • The six month annualised growth rate in the WestpacMelbourne Institute Leading Index, which indicates the likely pace of economic activity relative to trend three to nine months into the future, rose from –0.15% in June to –0.12% in July.

Let’s recall the shocking McKibbin Doctrine: Obsessed by weak commodity prices and volatility in global financial markets to the point of not thinking about the future?

Yesterday’s post on the slightly improved outlook for 2017 Australian growth prompted some criticism from readers, as well as some soul searching.

This time from CBA: Investment is essential to both long run job creation and productivity growth, which ultimately drives real income growth.

For some time MB has had 2017 earmarked as a bust year for the Australian economy.

Mirabile dictu!

From Macquarie Bank:  We see two issues with the labour force data which suggest potential for volatility if the current complacency is challenged.

Just in from The Age: The future of the Portland aluminium smelter in Victoria – and the jobs of hundreds of workers – is in doubt with the power company which supplies the plant disclosing one of the plant’s owners is to terminate a supply contract, with all supply contracts expected to be axed.