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Thursday 14th April 2016 - 1:50 pm
Comments Off on Trend job growth eases

Trend job growth eases

by Alan Thornhill

Trend employment growth in Australia has eased.
The Bureau of Statistics reported today that this indicator, which the Bureau regards as the most reliable it produces, fell to just 2.2 percent in March.
That was down from 2.6 per cent in December last year.
On its more commonly used seasonally adjusted measure, the Bureau reported that the number of Australians with jobs rose by 26,100 in March.
That left the nation’s seasonally adjusted labour force participation rate for March at 64.9 per cent.
The Bureau said too that – on the same basis – the number of people unemployed fell by 7,300 during the month
This left Australia with a seasonally adjusted unemployment rate of 5.7 per cent for the month, 0.1 percentage points below the February level.

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Saturday 28th May 2016 - 8:10 am
Comments Off on The news: Saturday May 28

The news: Saturday May 28

by Alan Thornhill

Malcolm Turnbull and Bill Shorten meet again tonight for the second of their pre-election debates: ABC

Barrack Obama visits Hiroshima ABC

More than 100 leading scientists say the Rio Olympics should be moved or postponed over the Zika outbreak BBC

Thursday 31st March 2016 - 4:55 pm
Comments Off on Malcolm Turnbull puts a dodgy case to the Premiers

Malcolm Turnbull puts a dodgy case to the Premiers

by Alan Thornhill

The Federal government will use its economic heft, over the next few days, to force the States to impose their own income taxes, to cover an $80 billion cut in Federal health and education funding.

It says the cuts, over 10 years, have been necessitated by shortfalls in expected  revenue growth.

However figures published by the Australian Bureau of Statistics today, suggest otherwise.

They strongly suggest, that the argument Malcolm Turnbull has advanced, in this case, represents little more than an elaborate job shuffle.

At first, it all seems simple.

The Federal government and the States remain at odds over a tax reform plan that Malcolm Turnbull will put to the Premiers over the next few days.

The Prime Minister will urge the Premiers, at a dinner he will host for them tonight, to impose their own State income taxes to cover an $80 billion cut in Federal revenue, over the next 10 years.

The dinner will  launch proceedings in the latest meeting of the Council of Australian Governments, or COAG.

But Mr Turnbull’s already widely discussed proposal  has not found favour with the Premiers.

However the Prime Minister will insist that shortfalls in expected economic growth have made the cuts necessary.

He will, almost certainly, urge the Premiers over the next few days, to show patience as there are now fresh signs of strength emerging in the economy.

So what do we have, so far?

Another predictable argument between the Federal government and the States, over the carve up of the money used to govern this country.

Ho hum.

But let’s take a closer look at the figures the ABS published today.

They show a remarkably strong trend increase of 3.1 per cent in the number of job vacancies between in Australia between November  last year and February this year .

That left  Australia with 172,900 job vacancies in February this year.

The Bureau also reported  a spectacular trend rise – of 13.4 of cent – in these vacancies since February  last year.

Remarkably, the public sector led the way – with a 24.8 per cent trend rise – over the year, to February.

The  private sector also turned in a strong performance with a 12.4 per cent trend rise.

But as the Federal government is urging the States to do something they don’t want to do – that is impose their own taxes – they would be quite entitled to ask what these figures mean.

Does the spectacular rise in public sector job vacancies, for example, cover a lot of job churning?

The Premiers might  ask, for example, whether highly publicised job cuts – imposed by the Federal  government, were real or illusory.

That is were there a significant number of  Federal public servants who were sacked in  economy drives,  say on Fridays, who were back at new desks, perhaps by the following Mondays.

If job churning of this kind was significant, doesn’t  that cause the Commonwealth case for State income taxes  to collapse?

In any case, the   Federal  government will be hoping that all vacancies are filled quickly.

That would mean that many more people would – once again –  be paying tax and easing the Federal government’s budgetary problems.

Sunday 20th March 2016 - 6:21 pm
Comments Off on That marathon debate:what it did achieve?

That marathon debate:what it did achieve?

by Alan Thornhill

The ancient Greeks, who invented democracy, were sometimes not as proud of their invention as a modern observer might imagine.

Anyone who doubts that would be well advised to read Plato’s Republic, which should still be required reading for all modern political reporters, more than 2,000 years after the book was written.

Plato, the most prominent of Socrates’s students, knew just how hard it is to achieve coherent policies in a democracy.

Of course democracy, itself has moved on since his days, when pretty well any-one who wanted to turn up and speak on a subject in which they had a passionate interest, could simply do so.

But, perhaps amazingly, issues as apparently as fundamental as how people get appointed to the Senate, in the first place have been left unresolved.

And yes, that does affect how Senators vote.

And so the problems that worried Plato still exist today, though in a much more more moderate form.

Why, though, has it been so hard to find anything better?

There has been no shortage of suggestions.

These started with Plato himself who proposed that modern States be ruled by philosopher-kings.

That idea failed to take fire.

The  Greatest defender of democracy in modern times, Winston Churchill, often  expressed the view that it was the worst of all forms of government except for all the others.

The 76 members of the Senate, who hurled insults at each other  over the weekend, in a rare marathon debate, arguably took a similar position.

They had several questions before them, but the central one, undoubtedly, was how do we best ensure that the membership of the Senate reflects the will of the people who elect them.

That’s clear enough, isn’t it?

The Australian voters.

Yes, but odd features of the system we have have made it possible, till now, for candidates with very small primary votes to find themselves elected on votes spilt from the major parties.

And not only that, but in a very powerful position on the cross bench in the Senate, able to delay legislation the government regards as essential.

No government can be expected to accept that happily.

Especially not when the insults offered, in the marathon debate we saw at the weekend, include highly un-parliamentary direct quotations from border-line radio comedy shows, such as this line from Monty Python.

“I fart in your general direction.”

That’s why the Turnbull government also declared, in that debate, that it was  prepared to keep  the Senate sitting for a week, if necessary to get its bill, which would wipe out micro parties, elected  passed.

In the end it wasn’t.

The Senate accepted the bill early on Saturday afternoon, in an unscheduled session, after the Senate satt past midnight the previous Friday.

The Prime Minister, Malcolm Turnbull, responded generously, with a statesman-like speech, in which he said, this had been “a great day for democracy.”

r too long, Mr Speaker….the Senate voting system has been disturbed by backroom deals, by preference whisperers, by the manipulation of micro parties such that we have seen the will of the people frustrated.

“Mr Speaker there is nothing more important (than) t htat the men and women that sit in this chamber and the Senate reflect as far as possible the wish of Australian people.

“And that has not been the case with the Senate and we have known this for many years.

“For many years the practice of group voting tickets, of backroom deals, of elaborate creation of micro parties has resulted in people being elected to the Senate with a tiny fraction of primary votes.

“It has undermined the reputation; it has undermined the democratic reputation and credibility of the Senate which is half of this great Parliament.

“ Mr Speaker, the changes that are contained in this Bill and reflected in these amendments represent what was not so long ago the bipartisan position, the position of every party in this Parliament.

“Mr Speaker, it was the unanimous recommendation of Joint Standing Committee on Electoral Matters. Labor, Liberal, The Greens; all agreed that it should be Australian voters who decide where their preferences go.

“It should be Australians who choose who should be elected to the Senate, not backroom deals.”

SO The result of this marathon debate has been a step forward, certainly

The passage of this bill will enhance the reputation of the Senate, by making it more democratic.

But it won’t solve all problems, with democracy, itself.

That is a very big ask.

But it will require all of us to take a closer interest in our politics.

That’s what democracy is all about though,isn’t it?

Thursday 17th March 2016 - 12:54 pm
Comments Off on Strong job growth eases

Strong job growth eases

by Alan Thornhill

The strong trend growth seen in Australian employment late last year has eased.

This development is evident in figures the Bureau of Statistics published today.

The Bureau reported that, on its calculations. Australia’s seasonally adjusted unemployment rate fell from 6 per cent in January to just 5.8 per cent In February.

It also said that employment had increased by 11,400 on trend estimates during the month while unemployment fell by 700.

On trend estimates, Australia’s employment growth hit 2.6 per cent in December last year.

By February this year, that figure had fallen to just 2.3 per cent.

Sunday 14th February 2016 - 6:39 pm
Comments Off on Decentralisation:who really benefits?

Decentralisation:who really benefits?

by Alan Thornhill


Barnaby Joyce’s imminent rise, to the post of Australia’s Deputy Prime Minister, is producing some apprehension in the nation’s capital, Canberra.

Not least on the issue of decentralisation.

Mr Joyce’s promotion became inevitable last week, when his National Party colleagues chose him to succeed the party’s previous leader, Warren Truss, who is retiring.

The National Party, now the junior partner in Malcolm Turnbull’s coalition government, was once called the Country Party.

And Mr Joyce retains its strong rural and regional focus.

That is reflected in his attitudes to decentralisation.

So no-one in Canberra was particularly surprised when plans to decentralise government scientific and other work to the Great Southern region, near Albany in Western Australia’s Great Southern region, Northam in that State’s Wheatbelt, or even to Tasmania, seemed to take on new life, with the announcement  of Mr Joyce’s new job.

He doesn’t actually become Deputy Prime Minister, of course, until he takes the oath of office.

That is scheduled for Thursday this week,at Government House in Canberra.

Those looking for differences between Mr Joyce and Mr Turnbull, won’t have too much trouble finding them.

Mr Turnbull is, after all, a free-trader, right to the soles of his highly polished shoes.

There is something of a protectionist about Mr Joyce.

He would not shrink from a direct intervention in a market, if he believed that to be valuable.

All this is illustrated, clearly enough, in his attitude towards decentralization.

But he is clever about it.

Earlier this month, while announcing the relocation of three research organisations from Canberra to regional Australia, he said:”I have accepted proposals from three Canberra-based research and development corporations to increase their regional presence, which will boost jobs and growth in Dubbo, Wagga Wagga, Toowoomba and other areas.

“As well as being home to vibrant farming communities, these regions also have some of the best agricultural universities and research facilities in the country.

“It is logical that strong links should exist between the RDCs, universities and farmers on the ground in each industry.

“Being geographically closer to the industries they serve will strengthen their relationships and help the RDCs better understand their individual industry’s needs.”

There are limits to this kind of thing, of course.

Valuable knowledge, built up over years, in a sophisticated city like Canberra, which offers a wide range of educational and medical services, can be lost if a key scientist, chooses to leave a particular project, rather than accept a particular transfer.

And that whole process can become economically expensive, if adopted for political, rather than industrial reasons.

There are some fine questions of balance, here.

Friday 5th February 2016 - 7:23 pm
Comments Off on Expect stronger growth – but not just yet:RBA

Expect stronger growth – but not just yet:RBA

by Alan Thornhill

The Reserve Bank sees stronger economic growth ahead – though not just yet.

In a revision to its latest statement on monetary policy published today, the bank said that – as expected –  the Australian economy had grown at a “below average” pace over the year to September 2015.

It said this had been “the starting point” in calculating its latest forecasts – which include 3-4 per cent growth in the 12 months to the end of June 2018.

The Bank said that:“over the next few years, growth is expected to remain around its current rate, which is slightly below its decade average.”

But it expects things to pick up after that.

It added that:”Activity continued to shift from mining to non-mining sectors of the economy.”

“Services sector output grew by around 3½ per cent over the year to September, while goods-related output grew only modestly.”

The bank also noted that:” Mining investment continued to decline sharply, although this was partly offset by contributions from resource exports.”

“ Net service exports also made a significant contribution to growth, partly reflecting the effects of the exchange rate depreciation.”

“ Non-mining business investment was little changed over the year.”

The bank also said that dwelling investment continued to grow strongly

and consumption growth picked up to be close to its decade average.

But it added: “ Public demand grew at a below-average pace over the year.”

The bank also said:“The forecasts for iron ore and coal prices are lower, reflecting a weaker outlook for Chinese steel demand and an expectation that there will be only a limited reduction in global supply from high-cost miners, particularly those in China.”

Wednesday 27th January 2016 - 1:07 pm
Comments Off on World’s worries “may affect our growth”

World’s worries “may affect our growth”

by Alan Thornhill

International developments may weigh on Australia’s growth in the months ahead.

That is the conclusion that Westpac economist, Bill Evans, is drawing from the latest edition of the bank’s leading index.

Mr Evans says the index, which the bank compiles with the Melbourne Institute, indicated that  the likely pace of economic activity three to

nine months into the future, fell from –0.40 per cent in November to –1.03 per cent in December.

He said:“This is another disappointing result.

“The Index has now been growing below trend for the last eight months.”

“It continues to signal that growth in the Australian economy in the first half of 2016 will be below trend.”

“ Apart from in August 2015, this negative deviation represents the largest deviation we have seen since the second half of 2011,” Mr Evans said.

He said both Treasury and the Reserve Bank are now assessing trend – or potential – growth at 2.75 per cent.

He said Westpac’s current forecast for 2016 entails an annual growth pace in the first half of 2016 of 2.75 per cent, on trend figures.

But the LeadingIndex indicates that this forecast might be “somewhat optimistic,”Mr Evans said.

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Alan Thornhill

Alan Thornhill is a parliamentary press gallery journalist.
Private Briefing is updated daily with Australian personal finance news, analysis, and commentary.

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