A new direction: The truth about the economy they don’t want you to know

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In this case, the truth hurts (Image edited by Dan Jensen)

Data showing Australia’s economy declining piles up every week, as the various agencies release their regular bulletins. Whether by laziness, overwork or desire to protect the pro-big business Turnbull Government, little gets reported in the mainstream press. Independent Australia will now do the gleaning so you don’t have to.

Jolt to the jobless

Australia may finally be joining the global surge in job creation, with the latest unemployment rate falling to 5.3%, the lowest since November 2012.

But maybe not. Back then, 5.3% ranked equal sixth lowest out of the 35 wealthy member countries of the Organisation for Economic Development and Cooperation (OECD). In November 2012, Germany and Australia both had 5.3% of their workforce unemployed. Only South Korea, Switzerland, Norway, Japan and Mexico had lower jobless rates.

Today, four years into the strongest global boom in trade, jobs and profits in decades, 5.3% ranks 18th. That is in the bottom half of the table. Thirteen countries now have their jobless rate below 4.0%.

If Australia still ranked sixth in the OECD, its rate would be 3.5% and another 243,000 Australians would be off welfare and earning a salary.

Workers needing more work

Part-time employees wanting to work more hours remain close to the all-time high.

The ABS has released its annual 'Participation potential: Part-time workers who would prefer more hours' report. This counts all part-timers – some working as little as an hour a week – who need more work.

The long-term average since 1985 is 22.9% of all jobless. The highest was in 2015 at 30.1%. Second highest was last year at 29.8%. This year’s is third highest ever at 29.5%.

Hours worked per person per month

This measure – the best indicator of jobs any economy is generating – has been jammed below 87.0 for three months now.

The average through the dismal Howard years was 87.7. The Rudd/Gillard period averaged 89.2.

In the current global jobs boom, this really should be well above 90.0

Real wages tumbling further

Over the full financial year to June, wages – public and private sectors – rose just 2.14%. That is the third lowest year-to-June result on record. The second lowest was 2.06% in 2016, after two failed Joe Hockey budgets. The lowest was last year, after Scott Morrison’s first Budget.

With inflation to June at 2.1%, this is effectively no increase at all in real terms.

But here’s the thing. We know from annual reports that executive salaries are currently booming. BHP’s Andrew Hamilton, for example, received A$6.26 million in his last pay cheque, up 103% on his A$3.08 million the year before.

So with the top end racing, an average of 2.14% means most workers below the median must be losing badly.

Government debt just keeps on expanding

Gross debt last Friday was $531.7 billion. That is up $147.9 billion, or 38.5%, from when Turnbull and Morrison replaced Abbott and Hockey, and up $260.0 billion, or 95.7% from the 2013 election.

Debt compared with other countries

Since 2013, Australia’s gross debt has ballooned from 30.7% of GDP to 41.9% — an increase of 11.2% of GDP.

Of the 35 wealthy OECD countries, only Mexico, with an increase of 11.6%, has performed worse. The majority of those 35 countries have taken advantage of the global boom and reduced their debt as a percentage of GDP over that period.

Retail sales slump

A recent report by this writer in Crikey revealed Australia’s growth in retail sales for the financial year 2017-18 was the lowest since records began 36 years ago. No other business journal bothered to report this fact after the results came out. This is curious because some reported expectations the day before.

At just 2.55% growth, this is an actual decline after adjusting for population and inflation. The long-term average rise is 5.79%.

The astonishing thing here, again, is that this has happened during the current sustained global upswing.

Historic note

Intriguing facts emerged in researching that story on Australia’s retail sales that have not yet been reported. During the three years after the onset of the global financial crisis – 2008, 2009 and 2010 – only one country out of the (then) 34 rich OECD members succeeded in increasing retail turnover every month. All 36 months registered a rise over the same month the year before. That’s quite something. But it appears to have eluded the business journals and mainstream media.

Yes, it was Australia. Most economies fared disastrously. 20 countries recorded declines for 15 or more months out of the 36. Four recorded more than 30 declines over the 36 months — Estonia, Hungary, Latvia, and Spain.

Has Australia now shifted from having the best-performed retailers in the OECD to the worst?

Electric cars lagging

Speaking of world’s worst, Australia ranks 30th out of 30 developed countries on proportion of petrol stations with charging points for electric cars. It ranks 25th on overall charging point availability. Australia has less than one point per 100 km of road network.

That’s according to data from the International Energy Agency, published by gocompare.com. This was reported by news.com.au, which asserted ‘Australia is almost a decade behind the rest of the world’ – but appears to have been missed by Fairfax, the ABC and other business media.

Causes of Australia’s economic collapse

As Independent Australia has regularly reported, causes include wage stagnation for the majority of workers over the last four years and wage cuts for many. Unemployment and underemployment remain entrenched, and pensions have failed to keep pace with costs. The tax burden has shifted from corporations and high-income professionals to wage and salary earners.

Hence, the vast majority of Australians no longer have the disposable income they once had. This impacts retailers immediately and then flows on to wholesalers, manufacturers, importers, transport and other sectors.

Australia does not need a new prime minister. It needs an entirely new economic direction.

You can follow Alan Austin on Twitter @AlanAustin001.

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