Remuneration Trends and Insights

Key Economic Indicators

Mercer's Key Economic Indicators reviews key statistical indicators of the Australian economy.

 

 

September 2020

 

Economy snapshot

 

This section reviews key statistical indicators of the Australian economy, including:

  • Gross Domestic Product (GDP)
  • Inflation – Consumer Price Index (CPI)
  • Employment and unemployment
  • Wage Price Index (WPI)

Key economic indicators showed:

  • Negative GDP growth
  • Low inflation
  • Growing unemployment rate
  • Low wage price growth



GDP growth


GDP decreased by 7.0% (seasonally adjusted) in the June quarter, bringing the annual GDP growth to June 2020 to -6.3%.

The June 2020 quarter results showed positive growth in 5 of the 20 industry divisions (seasonally adjusted). 


The top three positive movers were:

  • Public administration and safety (up 0.9%)
  • Financial and insurance services (up 0.7%)
  • Ownership of dwellings (up 0.6%)

The lowest three movers were:

  • Accommodation and food services (down 39.0%)
  • Arts and recreation services (down 22.6%)
  • Transport, postal and warehousing (down 21.5%)


Consumer Price Index


The all-groups CPI reported a decrease of 1.9% in the June 2020 quarter, following a change of 0.3% in the March 2020 quarter [ABS catalogue 6401.0]. The annual change from June 2019 to June 2020 was -0.3%. 

 

The most significant price rises in the quarter were:

  • Other non-durable household products (up 4.5%)
  • Furniture (up 3.8%)
  • Tobacco (up 2.7%)

The most significant offsetting price falls in the quarter were:

  • Child care (down 95.0%)
  • Automotive fuel (down 19.3%)
  • Preschool and primary education (down 16.2%)
  • Rents (down 1.3%)

 

CPI - % change by location

 
  June quarter 2020 (%) Year to June 2020 (%)
Sydney -2.3 -1.0
Melbourne -1.8 0.3
Brisbane -2.2 -1.0
Adelaide -1.0 0.8
Perth -1.2 0.1
Hobart -1.4 1.3
Darwin -2.5 -1.8
Canberra -2.3 -0.6
Weighted average of eight capital cities -1.9 -0.3
 

Source: Australian Bureau of Statistics



Employment


In August 2020, the seasonally adjusted national unemployment figure decreased to 6.8% (ABS catalogue 6202.0). The unemployment rate for males and females is 7.0% (seasonally adjusted) and 6.6% respectively.

 

The seasonally adjusted labour force participation rate for August 2020 increased compared to last month to 64.8%, with male and female participation rates recorded at 69.7% and60.0% respectively.

 

There were 12,583,400 people employed nationally in August 2020, with full-time employment increasing to 8,584,500 and part-time employment increasing to 3,998,900 according to seasonally adjusted figures.


On a seasonally adjusted basis, the unemployment rates for each state in August 2020 were:

  • New South Wales – 6.7%
  • Victoria – 7.1%
  • Queensland –7.5%
  • South Australia – 7.9%
  • Western Australia – 7.0%
  • Tasmania – 6.3%

 

Australian labour force data  2019-2020

 
  Unemployment rate (%) Participant rate (%)
August 2019 5.2 66.2
September 2019 5.2 66.1
October 2019 5.3 66.0
November 2019 5.1 65.9
December 2019 5.1 66.0
January 2020 5.3 66.1
February 2020 5.1 65.9
March 2020 5.2 65.9
April 2020 6.4 63.6
May 2020 7.1 62.7
June 2020 7.4 64.1
July 2020 7.5 64.7
August 2020 6.8 64.8
 

Source: Australian Bureau of Statistics



Wage Price Index

 

The Wage Price Index [ABS catalogue 6345.0] measures changes in wage and salary costs for a selection of jobs, unaffected by changes in the quality and quantity of work performed.

 

Movements in total hourly rates of pay (excluding bonuses) - original figures

 
  June 2020 quarter  (%) change June 2020 year (%) change
All employees in Australia 0.0 1.7
Private sector -0.1 1.7
Public sector 0.4 2.1
New South Wales 0.0 1.8
Victoria -0.1 1.7
Queensland 0.0 1.7
South Australia 0.4 2.4
Western Australia 0.2 1.6
Tasmania 0.3 2.4
Northern Territory 0.1 2.3
Australian Capital Territory 0.2 2.0
Mining 0.5 2.0
Manufacturing 0.2 1.7
Electricity, gas and water and waste services 0.6 2.5
Construction -0.5 0.8
Wholesale trade -0.1 1.4
Retail trade 0.1 1.7
Accommodation and food services -0.1 1.9
Transport, postal and warehousing 0.1 1.9
Information media and telecommunications 0.0 1.6
Financial and insurance services 0.4 2.0
Rental, hiring and real estate services -0.1 1.8
Professional, scientific and technical services -0.5 1.3
Administrative and support service 0.2 1.9
Public administration and safety 0.2 2.0
Education and training 0.5 2.3
Health care and social assistance 0.1 2.4
Arts and recreation services 0.1 2.6
Other services -0.9 1.1
 

Source: Australian Bureau of Statistics

Disclaimer: While every care has been taken to ensure the accuracy of the information, no warranty is given in respect thereof.


 

Download the latest report


Keep your finger on the pulse with the latest trends and insights on the current rewards environment, key economic data affecting pay decisions, topical HR issues and much more!

Speak with a Mercer Consultant

To learn how Mercer can assist with your organisations Remuneration, Benefits or Workforce Planning complete the form below and a Mercer Consultant will be in contact with you.

*Required Fields

We're Here to Help