In 2018, Australia is experiencing its 27th year since the last recession, one of the longest periods of growth experienced by a nation in the modern era.
The current year has started well, with many companies hiring new staff, reporting higher sales and increased profitability. Interest rates seem to be on hold, thanks in part to minimal wage inflation, high household debt and uncertainty surrounding global trade. It is now twenty-two months since the last interest rate change by the Reserve Bank.
Recent economic surveys show that business activity is improving. Economic data released by Australian Bureau of Statistics revealed that during the March 2018 quarter the economy grew at the swiftest pace in almost two years. Gross domestic product expanded by 1% in the March quarter, with annual growth bounding to 3.1%.
The unemployment rate has remained at around 5.5% for the past year but various economic indicators point to solid growth in employment, fuelled by business and government.
Despite a substantial rise in people obtaining full-time work in the past six months, the main reasons for the stable unemployment rate and low wages growth relates to the significant rise in women and older people seeking work. The current unemployment and wages rate is likely to continue for the next six months, but the gradually expanding economy will eventually push both, employment and wages higher.
Slowly and steadily economic growth is picking up and employment conditions are improving in Australia.
Undoubtedly, at this point, the economy is following familiar themes from prior years with conditions the most buoyant in mining, energy, construction and business services, while retail continues to underperform. However, increased expenditure by state and federal governments on infrastructure along the east coast together with any personal or company tax cuts should assist future strong economic growth.
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