Bad news on Australia’s economy at last

The mainstream media warmly welcomed Australia’s latest economic data, as Alan Austin reports.

WAGES IN AUSTRALIA over the course of 2025 grew by 3.44%. Unfortunately for workers, this was below the inflation rate of 3.76%, so they ended the year poorer on average. That’s according to wages and consumer price index data from the Bureau of Statistics (ABS).

While disappointing for the employees impacted, this is fantastic news for all the anti-Labor hacks in the mainstream newsrooms. This means that for once in their miserable lives, they can prepare negative narratives about the Albanese Government without gaslighting and concocting falsehoods. At last!

Field day for the forlorn fearmongers

Although the difference between wage growth and price increases was a fraction of a point – technically referred to as a poofteenth – wages did actually fall behind. Headlines which gleefully amplified this included:

‘Real wages go backwards for first time in two years as inflation jumps’ [Australian Financial Review]
‘Data reveals 'real wages' position of workers as wage price index lags inflation’ [ABC News]
‘As real wage growth falls again, Australian workers must feel the economy is rigged against them’ [The Guardian]
‘Under pressure, Chalmers suddenly has a challenge on his hands’ [Australian Financial Review]
‘Real wages have gone backwards. Even earning $100,000 isn’t what it used to be’ [The Conversation]
‘Dismal inflation news as real wages fall’ [Yahoo NewsWire]
‘Labor must fix our tax system. Anything less is economic destruction’ [The Sydney Morning Herald]

Luxury spending boom exposes newsroom lies about the economy

The latest consumer spending data confirms the economy is managed far better than the media acknowledge.

The full picture on wage rises

Of course, none of these “stories” accurately reported the situation. The last thing the newsrooms want is for readers to be well-informed.

In fact, over the last three years, since Treasurer Jim Chalmers delivered his first Budget in the fourth quarter of 2022, wages have risen 11.33%. Total inflation over those 12 quarters has been just 8.50%. Workers are still significantly ahead under Labor, despite the latest quarterly blip. This was omitted.

Yes, one period of price rises above wage rises is disappointing. But it is not devastating. It’s not even surprising, given that free enterprise economies allow businesses to make individual decisions on hiring, firing and remunerating, and on the timing and extent of price rises.

Despite having actual bad news to broadcast, some of these outlets continued to concoct falsehoods anyway. The Australian Financial Review spruiked new Shadow Treasurer Tim Wilson as ‘ready to pour water on Australia’s inflation bonfire’.

Bonfire? Really? Apparently, they want readers to forget that baby boomers lived through decades of inflation above 8%. For two years under Bob Menzies, inflation ranged between 10% and 24%. It was above 20% for four quarters. Through the entire seven years under Malcolm Fraser, inflation fluctuated between 7.6% and 14.3%. It was above 10% for 16 quarters.

As recently as 2021-22, inflation surged to 8.44%. It might still be above 8% if voters hadn't changed the federal government in 2022. We will never know.

Bonfire? Inflation today at 3.76% is a wisp of smoke compared with levels under previous Coalition administrations.

Misplaced negativity blocks social progress

Addressing Australia’s urgent reforms requires more confidence and less division.

All Australians richer

Looking across the economy and contrasting outcomes with comparable nations, Australians are currently faring well.

Everyone holding cash, savings or investments valued in Australian dollars is now about 10% richer than before Christmas, as a result of the Aussie dollar appreciating.

Since 21 November, the Australian dollar has jumped 10% against the U.S. dollar, the Japanese yen and the Hong Kong dollar, and is up strongly against nearly all other trading currencies.

This is partly due to steady budget improvement, as affirmed last week by the International Monetary Fund’s 2026 consultation report, which gave Albo and Dr Jim huge ticks.

It is also attributable to Australia’s strengthened standing in the world following successful trade negotiations with the European Union, Indonesia, Singapore, the UAE, New Zealand and elsewhere, and remarkably benign outcomes from dealings with the corrupt and incompetent Trump regime over tariffs and defence.

Housing surging at last

Australia now has housing construction underway in all categories — investors building rental properties, owner occupiers, new home buyers and social housing for welfare beneficiaries.
According to this month’s report on bank lending from the ABS, the total loaned for all new homes reached a record $383.5 billion in 2025. See chart below.

The number of new owner-occupier loans rose 4.8% in the December quarter, with the value up 10.6% to a record $65,315 million. The number of first home buyer loans jumped 6.8% in the quarter, while the value rose 15.5%. The value of all new loan commitments for dwellings increased 9.5% to an all-time high $108,300 million.

Other key indicators all positive

Australian jobs increased in January by nearly 18,000 to click over 14.7 million, easing the jobless rate fractionally to 4.08%. Incidentally, that makes four straight months with the jobless rate declining marginally.

The ABS has also reported excellent outcomes on farm production, tourist arrivals, import and export prices, the narrowing gender pay gap and spending on luxuries, as analysed here last week.

What can be done to fix things further?

Regarding the immediate issue of wages falling slightly behind prices, this can be fixed with a lift in the minimum wage and in award wages in forthcoming wage negotiations.

Price rises can be moderated by continuing efforts to monitor price gouging and punish offending corporations. The Australian Competition and Consumer Commission (ACCC) is now prosecuting Coles and Woolworths in the Federal Court for allegedly rorting price discounts.

These developments are most encouraging for those who wish to celebrate a healthier, wealthier, fairer and happier community. Unfortunately, that is not everyone.

Alan Austin is an Independent Australia columnist and freelance journalist. You can follow him on Twitter @alanaustin001 and Bluesky @alanaustin.bsky.social.