ECONOMIC INDICATORS – AUSTRALIA

Builders at risk as approvals decline

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Original article by Michael Owen
The Australian – Page: 19 : 14-Mar-19

Data from the Australian Bureau of Statistics shows that there was a year-on-year decline of 3.2 per cent in the trend estimate for total building approvals nationwide in January, while the value of total building approvals fell by 1.5 per cent. Justin Lokhorst of the ABS notes that the trend estimate for total building approvals has fallen to its lowest level since May 2013. The data also shows that Tasmania and the Australian Capital Territory were the only jurisdictions that did not record a decline in building approval values in the last 12 months.

CORPORATES
AUSTRALIAN BUREAU OF STATISTICS, URBAN TASKFORCE AUSTRALIA LIMITED, MASTER BUILDERS AUSTRALIA INCORPORATED, MASTER BUILDERS’ ASSOCIATION OF SOUTH AUSTRALIA INCORPORATED, CUBIC HOMES, JML HOME CONSTRUCTIONS, ODM GROUP, OAS GROUP, PLATINUM FINE HOMES

Employment growth stalls as overall employment down on a year ago

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Original article by Roy Morgan
Market Research Update – Page: Online : 14-Mar-19

The latest data for the Roy Morgan employment series shows that 12,174,000 Australians were employed in February 2019, down 54,000 over the past year. The fall in employment was driven by a decrease in part-time employment of 60,000 (to 4,015,000); full-time employment was virtually unchanged, up by 6,000 to 8,159,000. The figures also show that 1,292,000 Australians (9.6% of the workforce) were unemployed in February, down 18,000 on a year ago, and the unemployment rate decreased by 0.1%. In addition, 1,156,000 Australians (8.6% of the workforce) were under-employed, working part-time and looking for more work, a decrease of 54,000 in a year (down 0.3%). In total, 2,448,000 Australians (18.2% of the workforce) were either unemployed or under-employed in February, a decrease of 72,000 in a year (down 0.4%). Roy Morgan’s real unemployment figure of 9.6% for February is significantly higher than the current ABS estimate for January of 5.0% although Roy Morgan’s under-employment estimate of 8.6% is comparable to the current ABS underemployment estimate of 8.1%. Meanwhile, the latest Roy Morgan Poll conducted over the last two weekends of March 2/3 & 9/10 with a representative cross-section of 1,603 electors shows the ALP 55.5% cf. L-NP 44.5% on a two-party preferred basis. The ALP’s lead amongst women is even stronger with women supporting the ALP 56.5% cf. L-NP 43.5% while men also support the ALP but to a lesser degree: ALP 54% cf. L-NP 46%.

CORPORATES
ROY MORGAN LIMITED, AUSTRALIAN BUREAU OF STATISTICS, MORGAN POLL, AUSTRALIAN LABOR PARTY, LIBERAL PARTY OF AUSTRALIA, NATIONAL PARTY OF AUSTRALIA

Roy Morgan CEO Michele Levine comments on the latest employment data

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Original article by Michele Levine, Roy Morgan
Market Research Update – Page: Online : 14-Mar-19

The lack of jobs growth over the last year will be a significant concern for the Federal Government, which is due to seek re-election at a Federal election expected in mid-May. As well as the lack of employment growth over the past year the latest Roy Morgan Business Confidence rating for February of only 105.6 – the lowest since August 2015 – indicates Australia’s businesses are waiting for the political uncertainty to clear in a few months’ time. The consecutive ratings below 110 are the slowest start to a year for Business Confidence since the index began. The latest Australian GDP figures showed the economy growing by only 0.2% in the December 2018 quarter, the slowest rate of growth for over two years since a quarterly contraction of 0.5% in the September 2016 quarter. Given the political uncertainty facing Australia over the next two months, with a New South Wales election later in March before the Federal election expected in mid-May, the prospects for the economy and employment growth in the short-term appear to be limited. However, the Federal Government has a chance to ‘reboot the economy’ with a stimulative Federal Budget due to be delivered on the first Tuesday in April. The Budget is also the Morrison Government’s last chance to save their chances of re-election as the Roy Morgan Poll, and other polls, have consistently shown the ALP heading towards an easy election victory.

CORPORATES
ROY MORGAN LIMITED

Lowest paid being in richest 20pc of households blunts wage-lift case

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Original article by Matthew Cranston
The Australian Financial Review – Page: 4 : 13-Mar-19

Analysis of data from the Household, Income and Labour Dynamics in Australia (HILDA) survey shows that 13.8 per cent of the nation’s lowest-paid workers are living in the wealthiest 20 per cent of households. In contrast, 13.6 per cent of people on the lowest incomes are living in the poorest 20 per cent of households. The director of the HILDA Survey, Professor Mark Wooden, notes that many people on low incomes are secondary earners working in small business or the self-employed, particularly in wealthier households. He has also questioned the merits of a ‘living wage’, as advocated by Labor leader Bill Shorten.

CORPORATES
UNIVERSITY OF MELBOURNE. INSTITUTE OF APPLIED ECONOMIC AND SOCIAL RESEARCH, AUSTRALIAN LABOR PARTY, RESERVE BANK OF AUSTRALIA

ANZ-Roy Morgan Australian Consumer Confidence tumbles to 109.5

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Original article by Roy Morgan
Market Research Update – Page: Online : 13-Mar-19

ANZ-Roy Morgan Australian Consumer Confidence fell 4.6% to 109.5 in the week ended 10 March. All the sub-indices were in the negative, with three components falling more than 5%. The decline has also resulted in the headline index and each sub-index closing below their long-run averages. Households’ views towards current financial conditions fell 2.9% and views toward future financial conditions fell 5.4%. Consumers’ views toward current economic conditions fell 7.9% and views toward future economic conditions declined by 5.4%. The ‘time to buy a household item’ index fell by 1.7%, after a decline of 2.1% in the previous reading.

CORPORATES
ROY MORGAN LIMITED, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ

Rate cuts, not supply, the key to house prices

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Original article by Matthew Cranston
The Australian Financial Review – Page: 5 : 12-Mar-19

Reserve Bank of Australia analysts Trent Saunders and Peter Tulip have concluded that monetary policy has the biggest impact on house prices and the level of construction activity. They argue that historically low interest rates have been the major driver of rising house prices in recent years, while factors such as construction costs and population growth have had a smaller impact. In contrast, RBA governor Philip Lowe recently suggested that housing supply has been the major influence on prices.

CORPORATES
RESERVE BANK OF AUSTRALIA, AUSTRALIAN PRUDENTIAL REGULATION AUTHORITY

Resources boom gives government wriggle room

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Original article by David Uren
The Australian – Page: 4 : 7-Mar-19

Higher commodity prices in 2018 resulted in nominal GDP growth of 5.5 per cent for the calendar year. The mid-year Budget update in December had forecast nominal GDP growth of 4.75 per cent in 2018-19 and just 3.5 per cent in 2019-20. Treasury is likely to revise these forecasts in the April 2019 Budget, although it is expected to scale back economic growth forecasts in response to the national accounts data for the December quarter. Meanwhile, company and personal income tax revenue rose by 11.8 per cent and 7.6 per cent respectively in 2018.

CORPORATES
AUSTRALIA. DEPT OF THE TREASURY, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, RESERVE BANK OF AUSTRALIA

Miners fuel drive towards surplus

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Original article by David Uren
The Australian – Page: 4 : 5-Mar-19

Westpac and the ANZ Bank expect the latest national accounts data to show that the Australian economy grew by 0.2 per cent in the December quarter, while National Australia Bank has forecast growth of 0.4 per cent. Meanwhile, data from the Australian Bureau of Statistics shows that pre-tax profits in the resources sector rose by $17.5bn in calendar 2018, which will in turn boost federal government revenue. However, earnings outside of the resources sector fell by 1.5 per cent during 2018.

CORPORATES
WESTPAC BANKING CORPORATION – ASX WBC, AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB, AUSTRALIAN BUREAU OF STATISTICS, RESERVE BANK OF AUSTRALIA, AMP LIMITED – ASX AMP, AUSTRALIA. DEPT OF THE TREASURY

Spending boost to spur economy

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Original article by David Uren
The Australian – Page: 17 & 21 : 1-Mar-19

Non-mining investment is tipped to increase by 8.5 per cent in fiscal 2019, according to figures released by the Australian Bureau of Statistics. This is excess of the four per cent growth that Treasury had forecast in its mid-year budget review, while the Reserve Bank’s monthly credit report reveals that business lending is now at 5.2 per cent annual growth. The latest GDP figures are due to be released in the week beginning 4 March, with the Commonwealth Bank forecasting growth of between 0.25 per cent and 0.5 per cent.

CORPORATES
AUSTRALIAN BUREAU OF STATISTICS, RESERVE BANK OF AUSTRALIA, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, ADELAIDE BRIGHTON LIMITED – ASX ABC, NATIONAL AUSTRALIA BANK LIMITED – ASX NAB

Inequality flatlines in Australia

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Original article by David Uren
The Australian – Page: 8 : 1-Mar-19

The OECD contends that there has been no increase in inequality in Australia in the last 15 years, which is at odds with Labor’s claim that inequality is rising. The OECD states that the income of the poorest 20 per cent of the population has risen the most since 2001, while middle-income earners have seen the lowest increase in income. It suggests that this is because workers in this income bracket are most vulnerable to automation. The OECD’s study was based on the Melbourne Institute’s Household Income and Labor Dynamics (HILDA) survey, with the OECD stating that income inequality in Australia is above the OECD average.

CORPORATES
ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT, AUSTRALIAN LABOR PARTY, UNIVERSITY OF MELBOURNE. INSTITUTE OF APPLIED ECONOMIC AND SOCIAL RESEARCH