Australia’s recession steepens and deepens

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The Q3 national accounts for Australia were another shocker, with the economy growing by only 0.3% over the quarter and by 0.8% over the year.

This meant Australia’s per capita recession extended to a record seven consecutive quarters after falling by 0.3% in Q3.

Australian GDP

Australia’s real per capita GDP has now declined by 2.1% since the Albanese government came to office in Q2 2022.

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Australia’s labour productivity fell by 0.8% in Q3, but was 0.3% higher year-on-year.

Labour productivity

The following chart shows the trend decline in Australia’s per capita GDP and productivity growth over the past 20 years, which coincides with the boom in immigration.

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Finally, the household sector drove the decline in per capita GDP, as evidenced by the 2.0% fall in real per capita household consumption over the year.

Household consumption
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There is no sugar coating this release. It is a shocker that will place more pressure on the Albanese government leading into next year’s federal election.

The only thing stopping a full-blown technical recession is the federal government’s mass immigration program alongside record public spending.

However, the per capita recession has extended for a record seventh consecutive quarter, smashing Australian households and collapsing living standards.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.