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pietillidie
Joined: 07 Jan 2005
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| Post subject: Abbott's Economy: Wages Down, Now Investment and Growth Down |  |
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Now the adults are in charge, it's great to see everyone benefiting so handsomely!
Perhaps Australia should cut more science funding; roll out 2002 broadband speeds; make universities less affordable; refuse to put a price on carbon to stimulate technology investment; turn boat people into massive national security budgets; unsuccessfully interfere in expensive overseas civil wars; repeat the failed American experiment of creating a user-pay healthcare system; and push more people into temporary work in the inflated, remote, dirty, low-job creating mining industry as commodity prices decline!
That way everyone can build serious, high-paying careers doing, err, um, err...shining Gina and Clive's shoes!
| The SMH wrote: | The wage price index is growing at just 2.6 per cent, its slowest annual pace since the series began in 1998. Closely linked to this, the unemployment rate has been gradually climbing for the past three years or so to 6.2 per cent.
These are figures that are directly relevant to the 12 million odd people who either have a job or are looking for one.
When wages are growing more slowly than inflation, as they are now in annual terms, it means "real" wages are shrinking.
Taken together, the soft wage growth and rising unemployment rate show how soft things are in the labour market.
When employers are more focused on getting costs under control than hiring new people, it tends to push down wages. This is exactly what's happened in the past couple of years, across most industries.
UBS economists report that wage growth is less than 3 per cent in 14 of the 18 industry groups included by the official statistician. Just two years ago, there were only three industries where wages were growing so slowly.
It's not surprising that wage growth is weak when there is so much slack in the labour market, but the Reserve Bank says the extent of wage slowing has been more pronounced than previous experience suggested. |
http://www.smh.com.au/money/planning/belts-tighten-as-pay-rises-grind-to-a-halt-20141121-11r5m3.html#ixzz3KIWOD3lx
**Thread Title updated to reflected changing conditions over time.
_________________
In the end the rain comes down, washes clean the streets of a blue sky town.
Help Nick's: http://www.magpies.net/nick/bb/fundraising.htm
Last edited by pietillidie on Thu May 28, 2015 9:59 pm; edited 1 time in total |
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1061
Joined: 06 Sep 2013
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| Post subject: Re: Abbott's Economy: Wage Growth Slowest Since 1998 | |
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| pietillidie wrote: | Now the adults are in charge, it's great to see everyone benefiting so handsomely!
Perhaps Australia should cut more science funding; roll out 2002 broadband speeds; make universities less affordable; refuse to put a price on carbon to stimulate technology investment; turn boat people into massive national security budgets; unsuccessfully interfere in expensive overseas civil wars; repeat the failed American experiment of creating a user-pay healthcare system; and push more people into temporary work in the inflated, remote, dirty, low-job creating mining industry as commodity prices decline!
That way everyone can build serious, high-paying careers doing, err, um, err...shining Gina and Clive's shoes!
| The SMH wrote: | The wage price index is growing at just 2.6 per cent, its slowest annual pace since the series began in 1998. Closely linked to this, the unemployment rate has been gradually climbing for the past three years or so to 6.2 per cent.
These are figures that are directly relevant to the 12 million odd people who either have a job or are looking for one.
When wages are growing more slowly than inflation, as they are now in annual terms, it means "real" wages are shrinking.
Taken together, the soft wage growth and rising unemployment rate show how soft things are in the labour market.
When employers are more focused on getting costs under control than hiring new people, it tends to push down wages. This is exactly what's happened in the past couple of years, across most industries.
UBS economists report that wage growth is less than 3 per cent in 14 of the 18 industry groups included by the official statistician. Just two years ago, there were only three industries where wages were growing so slowly.
It's not surprising that wage growth is weak when there is so much slack in the labour market, but the Reserve Bank says the extent of wage slowing has been more pronounced than previous experience suggested. |
http://www.smh.com.au/money/planning/belts-tighten-as-pay-rises-grind-to-a-halt-20141121-11r5m3.html#ixzz3KIWOD3lx |
The aged care industry has maybe 10% full time positions, most are casual or permanent part time. It's not just the miners it's the poo cleaners too. |
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watt price tully 
Joined: 15 May 2007
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& I thought trickle down is when I'm a bit careless at the urinal 
_________________
“I even went as far as becoming a Southern Baptist until I realised they didn’t keep ‘em under long enough” Kinky Friedman |
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HAL
Please don't shout at me - I can't help it.
Joined: 17 Mar 2003
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| Whatever gave you that idea? |
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pietillidie
Joined: 07 Jan 2005
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| watt price tully wrote: | | & I thought trickle down is when I'm a bit careless at the urinal |
AKA the cyclist's curse
| Bloomberg Businessweek, taking Abbott's economic embarrassment global, wrote: | Australia Government Suffers in Polls as Abbott Breaks Vows
Tony Abbott, whose relentless taunts of Julia Gillard for breaking an election promise helped make him Australias 28th prime minister, is suffering the biggest fall in public approval for a new government in 30 years as he faces a similar attack on his integrity.
On the eve of the September 2013 election, Abbott vowed he wouldnt cut funding to popular programs. Now, in an effort to rein in a A$48.5 billion ($41.3 billion) budget deficit, his government plans to reduce spending on schools and hospitals by A$80 billion over the next decade and trim funding for the Australian Broadcasting Corp.
The reversal has enabled the Labor opposition to question Abbotts honesty with voters, undermining confidence in the Liberal-National coalition, which trails in opinion polls by three percentage points, having made the worst start for a party returning to office in almost 30 years. Hes failed to pass key savings measures through the Senate, eroding confidence in his ability to manage an economy where commodity prices are plunging and unemployment is at an 11-year high.
Abbott has already burnt up an enormous amount of political capital and its hard to get that back, said John Hewson, an economics professor and former shadow Treasurer who led the Liberals for four years in the early 1990s. Abbott ran a very negative campaign to win government and hes now getting that back in spades, he said.
Labor says the government has broken voters trust at a time the economy is slowing. The economy grew 0.5 percent in the second quarter, less than half the pace of the prior three months, while the Australian dollar has dropped 8 percent against its U.S. counterpart since the end of July, making it the third-worst performer among the Group of 10 major currencies. |
http://www.bloomberg.com/news/2014-11-28/australia-government-suffering-worst-polls-as-abbott-breaks-vows.html
The effing moron has failed because you cannot reform an economy without a compact that involves broad-based sacrifice, broad-based means for moving forward, and broad-based long-run dividends. But that requires a broad-based understanding of the world, which this inbred religious twit lacks, and has always plainly lacked.
Abbott's economic concept is nothing more than 1970s propaganda; a child-like Sunday school version of the world where the mighty and powerful are bestowed with magical powers by the gods, and drag us all to glory on their magnificent coattails (and big mouths), even as commodity prices steamroll their massive, over-inflated egos.
Get it straight, folks: There is no economic growth without broad-based productivity. No tiny cadre of chest-puffing mining baboons can generate even a fraction of what is needed to seriously grow an economy.
Those who opposed the broadening of Australia's income and employment streamseven as everyone expected commodity prices to softenshould be dismissed immediately for economic mismanagement and deception (much like those who politicked for those idiotic wars).
If you can't put together a comprehensive and balanced policy platform that includes extracting new productivity and revenues from science, technology, green innovation, education, and tourism, on top of the bonus revenues that mining and agriculture bestow upon the nation, then get the hell out of the way and stop wasting precious time in the life of the nation.
Speaking of the trickle-down effect... |
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pietillidie
Joined: 07 Jan 2005
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Imagine claiming to be economically responsible, then building a budget on inflated commodity prices and disgraceful measures such as the corrosion of medicare that don't pass the basic sanity test.
That's what happens when you don't have a rounded policy platform created with the good of the broader country in mind, but rather a wishlist from an extremist Business Council you hope to push through with the vocal fanaticism of the dumb racist hate vote.
| The SMH wrote: | Uphill struggle ahead for Abbott as troubles multiply
Prime Minister Tony Abbott heads into the final sitting week of the parliamentary year on Monday with his government struggling to explain unpopular policies and his premiership facing its keenest test since he won the 2013 election in a landslide.
Not only is he weighed down with the morale-sapping coalition loss in Victoria's state election at the weekend a harbinger of his own mortality unless things change but there are signs of growing disquiet inside both the federal Cabinet and the party-room over his office's political handling of both policy and personnel.
And proving the trouble often arrives in threes, his embattled Treasurer Joe Hockey is now in the ignominious position of beginning work on a second and necessarily tough budget while he is still lumbered with the failures of his first effort held up in the Senate.
A Deloitte Access Economics "Budget Monitor" report to be released on Monday, predicts "budget deficits as far as the eye can see" suggesting the Prime Minister's oft-stated promise of a budget back in the black by 2017-18 cannot now be achieved.
This is due to falling commodity prices mainly iron ore and also to Senate intransigence nourished by public opposition which has seen key austerity measures announced, factored into the bottom line, but then not delivered.
Mr Hockey is set to unveil the annual Mid-Year Economic and Fiscal Outlook around December 15 amid predictions the budget shortfall is getting worse not better despite the political pain already being sustained by the government.
The Deloitte Access Economics study compiled by Chris Richardson, predicts an underlying cash balance in 2014-15 of $34.7 billion some $5 billion worse than the government's own official forecast in the May budget.
But the real problem is likely to compound after a halving of the iron-ore price in the last year and other factors contributing to a slower path back towards balance than Mr Hockey projected. It means the balance sheet will still be firmly in the red to the tune of $12.4 billion in 2017-18 just when the government said it would be close to balancing the books.
This fiscal own-goal is attributed to a chronic revenue shortfall caused by successive governments which treated the "rivers of gold" in company tax receipts from a temporary mining boom as if it were a permanent new revenue source.
Mr Richardson said the "pre-GFC budget boost was $80 billion in 2007-08".
"No previous boom in economic history has been permanent," he said.
"In practice, the news since late 2011 has been almost universally bad ... those falls are taking the grandiose hopes and plans of Australia's politicians along with them."
Mr Richardson said the budget outlook was "still in reverse as China slows and the Senate fiddles".
The government is facing this economic challenge in a weakened political state.
It was in full damage-control mode on Sunday arguing the state election had no connection to Canberra and had been fought exclusively on state issues.
But the opposition claims that is "laughable" pointing out the Abbott government pledged a conditional $3 billion for the state government's East-West Link road project, dispatched the popular Julie Bishop to campaign in the dying days, and arranged for the asking of 21 "Dorothy Dix" questions regarding Victoria last week in federal parliament.
Even Liberals in Victoria blame a raft of poor decisions emanating out of Canberra, including last week's "barnacle debacle", for the removal of the first-term Napthine government. |
http://www.smh.com.au/national/uphill-struggle-ahead-for-abbott-as-troubles-multiply-20141130-11x3qe.html
_________________
In the end the rain comes down, washes clean the streets of a blue sky town.
Help Nick's: http://www.magpies.net/nick/bb/fundraising.htm |
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pietillidie
Joined: 07 Jan 2005
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Gittins nails the Abbott economic farce in a blinder of a piece:
| Gittins in the SMH wrote: | Why Joe Hockey's budget flopped so badly
Who could have predicted what a hash a Coalition government would make of its first budget? If Joe Hockey wants to lift his game in 2015, as we must hope he will, there are lessons the government - and its bureaucratic advisers - need to learn.
The first and biggest reason the government is having to modify or abandon so many of its measures is the budget's blatant unfairness. In 40 years of budget-watching I've seen plenty of unfair budgets, but never one as bad as this.
Frankly, you need a mighty lot of unfairness before most people notice. But this one had it all. Make young people wait six months for the dole? Sure. Cut the indexation of the age pension? Sure. Charge people $7 to visit the doctor, and more if they get tests, regardless of how poor they are? Sure.
Charge people up to $42.70 per prescription? Sure. Lumber uni students with hugely increased HECS debts that grow in real terms even when they're earning less than $50,000 a year? Sure.
What distinguished this budget was that even people who weren't greatly affected by its imposts could see how unfair it was to others.
Unfairly sacked Treasury secretary Dr Martin Parkinson is right to remind us we have to accept some hit to our pocket if the government's budget is to get out of structural deficit. But any politician or econocrat who expects to get such public acquiescence to tough measures that aren't seen to be reasonably fair needs to repeat Politics 101.
This is particularly so when a government lacks the numbers in the Senate - as is almost always the case. Without a reasonable degree of support from the electorate, your chances are slim. Especially when you subjected your political opponents to unreasoning opposition when they were in office.
A related lesson is that successful efforts to restore budgets to surplus invariably rely on a combination of spending cuts and tax increases. To cut spending programs while ignoring the "tax expenditures" enjoyed by business and high income-earners, as this government decided to do, is to guarantee your efforts will be blatantly unfair and recognised as such.
Move in on "unsustainable" spending on age pensions while ignoring all the genuinely unsustainable tax breaks on superannuation? Sure. Our promise to the banks not to touch super trumps our promise to voters not to touch the pension. This makes sense?
But a politically stupid degree of unfairness isn't the only reason this budget was such a poor one. Its other big failing was the poor quality of its measures. It sought to improve the budget position not by raising the efficiency and effectiveness of government spending, but simply by cost-shifting: to the sick, the unemployed, to the aged, to university students and, particularly, to the states.
This takes brains?
There are various ways to improve the cost-effectiveness of the pharmaceutical benefits scheme - though this would involve standing up to the foreign drug companies and to chemists - but why not just whack up the already high co-payment?
There are ways to reform the medical benefits scheme - by standing up to specialists - but why not just introduce a new GP co-payment, even though we already have a much higher degree of out-of-pocket payments than most countries?
The claim that introducing a GP co-payment constitutes micro-economic reform because it gets a "price signal" into Medicare lacks credibility. For a start, I don't believe that's the real motive. Who doubts that, once a co-payment is introduced, it won't be regularly increased whenever governments see the need for further cost-shifting?
For another thing, the notion that introducing a price signal would deter wasteful use without any adverse "unintended consequences" is fundamentalist dogma, not modern health economics.
Similarly, the notion that deregulating tuition fees would turn universities into an efficient, price-competitive market with no adverse consequences to speak of is first-years' oversimplification, not evidence-based economics worthy of PhD-qualified econocrats.
I'm not convinced the range of savings options Treasury and Finance offered the government was of much higher quality than the options it picked. This budget was so bad because so little effort was put into making it any better.
I'm starting to fear our governments and their econocrats have got themselves into a vicious circle: because the econocrats can't come up with anything better, they fall back on yet another round of that great Orwellian false economy, the "efficiency dividend".
But the never-ending extraction of what have become inefficiency dividends is robbing the public service of the expertise it needs to come up with budget measures that would actually improve the public sector's efficiency. |
http://www.smh.com.au/business/the-economy/why-joe-hockeys-budget-flopped-so-badly-20141130-11woo3.html#ixzz3KbaIrnVs
_________________
In the end the rain comes down, washes clean the streets of a blue sky town.
Help Nick's: http://www.magpies.net/nick/bb/fundraising.htm |
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Wokko 
Come and take it.
Joined: 04 Oct 2005
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Smokin' Joe is a 120kg+ weight around Abbott's neck. Too powerful to jettison into an unimportant ministry and too inept to trust with anything important.
I don't know who is advising Abbott apart from Peta Credlin, but he needs to get some strategy advisers in to tell him how $%$ed he is if things keep going the way they are.
Personally I'd be swapping out Hockey and Morrison. The immigration issue has been handled successfully so Joe can't really stuff things back up again and Morrison has been one of only two top performers. (Other one being Bishop, but I can't see her as treasurer).
Any other decent, financially savvy pollies in the LibNats? |
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3.14159 
Joined: 12 Sep 2009
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| Wokko wrote: |
Any other decent, financially savvy pollies in the LibNats? |
Last edited by 3.14159 on Mon Dec 01, 2014 2:14 pm; edited 2 times in total |
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3.14159
Joined: 12 Sep 2009
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Meanwhile the 1/2 year budget review has come in.
The deficit has doubled in the last 6 months.
Income down (the Libs are sacking 1/2 Australia but are allowing the rich allowed to run riot through the public purse) so that's no surprise.
A surplus a distant vision on a far horizon.
~
Abbott says this year was a Success!
http://www.theage.com.au/federal-politics/political-news/tony-abbott-steers-ship-into-storm-of-uncertainty-20141128-11vzxr.html
| wrote: | Most, however, did not have to think too hard about what should be scraped off the hull a patina of un-mandated, poorly argued, and woefully mismanaged savings measures announced in a budget that had famously been described by one senior figure as a "stinking carcass around the government's neck"
Abbott and Treasurer Joe Hockey have maintained their equanimity over the budget despite its toxic political implications.
Their assessment is that voters will come around once they see that tough action had been necessary.
Yet they seem to have no real strategy for getting to the point where wise hindsight can operate.
From a barnstorming 30+ seat landslide in 2013, the coalition's stocks have gone in just one direction ever since: down. A one-term government is suddenly a real fear*. |
*edit: In the above quote the phrase "a real fear" is used quite wrongly^^^[
Last edited by 3.14159 on Mon Dec 01, 2014 2:34 pm; edited 3 times in total |
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HAL
Please don't shout at me - I can't help it.
Joined: 17 Mar 2003
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| Are they exactly the same? |
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watt price tully
Joined: 15 May 2007
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Basically, the liberal party in government are wreckers. In opposition they are completely negative & their collective arrogance means they still operate as though they are the opposition.
To use the term that smoking Joe did "the age of entitlement" was said about others but not applied to themselves.
In the first 12 months they have acted as entitled shits who know best.
Ross Gittins an economics editor wrote an impressive (and obvious) piece in Fairfax:
Who could have predicted what a hash a Coalition government would make of its first budget? If Joe Hockey wants to lift his game in 2015, as we must hope he will, there are lessons the government - and its bureaucratic advisers - need to learn.
The first and biggest reason the government is having to modify or abandon so many of its measures is the budget's blatant unfairness. In 40 years of budget-watching I've seen plenty of unfair budgets, but never one as bad as this.
Frankly, you need a mighty lot of unfairness before most people notice. But this one had it all. Make young people wait six months for the dole? Sure. Cut the indexation of the age pension? Sure. Charge people $7 to visit the doctor, and more if they get tests, regardless of how poor they are? Sure.
What distinguished this budget was that even people who weren't greatly affected by its imposts could see how unfair it was to others....
[i]
from: http://www.smh.com.au/business/the-economy/why-joe-hockeys-budget-flopped-so-badly-20141130-11woo3.html
_________________
“I even went as far as becoming a Southern Baptist until I realised they didn’t keep ‘em under long enough” Kinky Friedman |
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Wokko
Come and take it.
Joined: 04 Oct 2005
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The Liberal Party in government are generally budget balancing scrooges WPT, but until this lot I think "wreckers" is just ideological nonsense. Of course, Hockey has used the budget as an ideological crusade against the poor/elderly/sick/unemployed and made of himself and the government he represents the exact caricature you first mentioned.
Abbott is at heart a social conservative Catholic and you can see that there is some kind of back room war going in between him and Hockey right now. I think, despite the mocking of Abbott he isn't the one who all the anger should be directed towards but to Joe and his corporate/banker/business/1%er overlords.
I'll take the Catholic nutjob over an faux-aristocratic turd like Hockey any day. |
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pietillidie
Joined: 07 Jan 2005
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| Wokko wrote: | | I'll take the Catholic nutjob over an faux-aristocratic turd like Hockey any day. |
That's setting the bar way too high for the Glibs!
_________________
In the end the rain comes down, washes clean the streets of a blue sky town.
Help Nick's: http://www.magpies.net/nick/bb/fundraising.htm |
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pietillidie
Joined: 07 Jan 2005
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More on the Abbott-led wage growth collapse based on a complete mismanagement of the economy under conditions of commodity price decline:
| The SMH wrote: | Australian wages growth hits the wall
Australian wages rose more than in any developed G20 nation between 2007 and 2013, as the resources sector shielded the country from the global financial crisis, according to the International Labour Organisation.
But times are changing for Australian workers and real wages growth has slowed to a snail's pace.
On average, by 2013 Australian wages rose 8.9 per cent from their 2007 levels. In Canada, which has also enjoyed a resources boom, workers' pay increase by 5 per cent in the same.
Data from the Australian Bureau of Statistics released last week showed that the seasonally-adjusted wage price index rose 0.6 per cent in the third quarter and 2.6 per cent over the last year, just outpacing inflation which grew 2.3 per cent through the year to September 2014.
Wages in the resources sector - the main contributor to strong overall wage increases during the mining boom years - had their slowest quarterly growth in the history of the data series, adding just 0.2 per cent in the three months to September, as investment in the resources sector shrinks and workers are laid off.
"The rate of wages growth has remained subdued in seasonally-adjusted terms since December 2012, fluctuating between 0.6 per cent and 0.7 per cent each quarter," the ABS said.
Globally, average monthly real wages grew by 2 per cent in 2013, down from 2.2 per cent in 2012. Growth has failed to rebound to its pre-GFC levels of around 3 per cent in 2006 and 2007, according to the the ILO's Global Wage Report, which was published Friday morning.
Real wages in developed economies have all but ground to a halt, rising just 0.1 per cent in 2012 and 0.2 per cent in 2013, the ILO said.
Developing economies fared much better, with wages jumping 6.7 per cent and 5.9 per cent respectively in the same two years.
In Australia, labour income share, that is the distribution of national income to workers, has fallen from 59.1 per cent in 1991 to 54.8 per cent in 2013, according to the ILO.
"In Canada - and also in Australia, part of the decline is tied to the rise in commodity prices; profits in the mining, oil and gas sectors in Canada doubled between 2000 and 2006," the ILO's report said.
Comparatively, wages in the United Kingdom slumped 7.1 per cent between 2007 and 2013, while Italy dropped 5.7 per cent. Wages in the US added just 1.4 per cent and German wages gained 2.7 per cent.
"Notable declines are observed in Italy and the United Kingdom, where the deep recession was accompanied by an unprecedented period of falling real wages. According to the Low Pay Commission, British wages fell more sharply than at any time since records began in 1964," the ILO said. |
http://www.smh.com.au/business/the-economy/australian-wages-growth-hits-the-wall-20141205-12165v.html#ixzz3L1m06M3u
_________________
In the end the rain comes down, washes clean the streets of a blue sky town.
Help Nick's: http://www.magpies.net/nick/bb/fundraising.htm |
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