Today's national account figures show that GDP per capita fell by 0.4% during the June quarter. This is the 6th consecutive quarter of negative GDP per capita growth, showing that Australia is in a per capita recession amid an ongoing inequality crisis.
Key Points:
- GDP per capita growth of -0.4% represents the 6th consecutive quarter of negative per capita growth in Australia while total GDP growth of 0.2% is historically weak.
- Household consumption fell by 0.2%, the weakest growth rate since the COVID-19 lockdowns in the September quarter of 2021.
- Government expenditure contributed 0.3% to GDP growth.
- Interest rates are a blunt instrument that are causing normal Australians significant financial pain while the tax system is turbocharging wealth inequality.
"Today's figures show that Australia's economy has gone backwards for a record six consecutive quarters once you take into account population growth," said Greg Jericho, Chief Economist at The Australia Institute.
"They confirm that households have been smashed by high interest rates despite our research showing that inflation has been mostly driven by company profits and supply-side factors. Fortunately, government spending has helped stop the economy from shrinking.
"Today's figures highlight again how necessary the change to the Stage 3 tax cuts were, which will deliver some much-needed relief to low- and middle-income households rather than overwhelmingly benefit the rich.
"Our research shows that the Australian tax system has turbocharged wealth inequality in this country over the last two decades. We are in an inequality crisis as much as we are in a cost-of-living crisis.
"We shouldn't be trying to tame inflation by punishing regular Australians who are already suffering under a tax system that is rigged to benefit the wealthy."
