ACTU Economic Bulletin - December 2013 by Australian Unions

Key points 

 

Australian economy and fiscal policy. This edition of

Australia’s government is one of the smallest in

the ACTU Economic Bulletin1 critically examines some

the OECD. We don’t need radical reductions in

of the premises underlying the Commission’s terms

the size of government.

of reference, and takes a look at some facts about

Tax revenue is lower, as a share of the economy,

the state of the nation’s books. It also has a look at a

than in any year of the Howard Government.

couple of areas that should be examined if the

The Commission has been asked to make

Commission wants to improve the budget position

recommendations to achieve a surplus of 1% of

without undermining equity – the taxation of

GDP by 2023. Projections by the BCA and

superannuation and personal income.

Treasury already have us on track to meet this target based on current policy. This target therefore cannot be used to justify large shortrun cuts to spending. 

To the extent that Australia has a fiscal policy challenge, it’s related to insufficient revenue, not

Figure 1: Government revenue and spending as a percentage of GDP in OECD countries in 2013 Revenue to GDP ratio 60 55

excessive expenditure. The tax cuts of the mid2000s were unsustainable and inequitable and should be unwound. 

Superannuation

tax

50 45

concessions

are

large,

growing, and skewed towards higher income earners. They should be reformed.

Canada

USA Australia

One of the new Commonwealth Government’s first acts on coming to power was to appoint a

30 30

40 45 50 Expenditure to GDP ratio

Commission of Audit – a body headed by Tony

Source: OECD Economic Outlook, Annex tables 25 and 26. Includes national, state, and local governments.

Shepherd, the chairman of the Business Council of

Australia’s governments, taken together, are smaller

Australia, and tasked with conducting a “full-scale

as a share of the economy than the governments of

review” of the government’s activities by March next

almost every other advanced economy in the world.

year. This is a large and difficult task, and one that

Our governments’ total revenues (including taxes and

will be made more difficult if the Commission starts from the wrong premises about the state of the

Note that there was no November edition of the Bulletin.

ACTU Economic Bulletin - December 2013 – Page 1

other sources) come to 33.2% of GDP – smaller than

Costello’s first year as Treasurer. Around 30% of

any other OECD country bar Korea and Japan.

these employees work in the military or reserves.2

Government revenues and spending in Australia are

Figure 3: Public sector employment as a proportion of total employment Per cent 30%

smaller, as a share of the economy, than those in any other English-speaking democracy, including the US.

25%

In the terms of reference for the Commission of

20%

Audit, the Government said that “the size of the Commonwealth

Government

has

expanded

Local

15%

significantly” in the past 20 years. This isn’t true if you

10%

measure the size of government by its revenue or

State/Territory

spending as a share of the economy, or by 0% 1984

employment levels in the public sector as a

1988

1992

1996

2000

2004

2008

Source: ACTU calculations based on ABS 6248.0, ABS 6248.0.55.002, ABS 6202. Shows general government sector employment as % of LFS employed persons.

proportion of total employment. Figure 2: Commonwealth revenue: 1995/96 to present % of GDP 27 All receipts 25

Whether you measure it by revenues, expenditures, or employment, the Commonwealth Government is relatively small and has not “expanded significantly.”

Tax receipts

The Government has told the Commission of Audit

21 19

Commonwealth

that “it is also essential that the Commonwealth Mr Costello's first Budget (22.4% tax, 24% total receipts)

Mr Swan's final Budget (22.2% tax, 23.6% total receipts)

government live within its means and begin to pay

15 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 Financial year ending in July

not been ‘living within its means’ and that no efforts

Source: Commonwealth Government 2013, Economic Statement.

premise.

down debt.” This implies that the Commonwealth has

have been made to pay down debt. This is a false

Commonwealth revenue is lower in the current year than it was in any year of the Howard Government.

It is entirely appropriate that the Commonwealth

Spending hasn’t “expanded significantly” either – it’s

allowed the automatic stabilisers to function in the

expected to be 25.3% of GDP this financial year,

wake of the global financial crisis, and also

compared to 25.1% in Mr Costello’s first Budget.

implemented discretionary fiscal stimulus, described

Government

“expanded

as “one of the best-designed Keynesian stimulus

significantly”. There were 250 000 people employed

packages of any country in the world” by Nobel Prize-

employment

hasn’t

by the Commonwealth in the ‘general government’ sector in 2011-12, down from 287 700 in Mr 2

Based on annual average staffing levels over the fiscal year 2012-13 of 79 132 Military and reserves employees and 182 505 in the rest of the general government sector.

ACTU Economic Bulletin - December 2013 – Page 2

2012

winning economist Joseph Stiglitz.3 Doing so entailed

Figure 5: Change in fiscal position of the Commonwealth (as a % of GDP) Percentage points 2

the accumulation of some public debt, but this was far preferable to the alternative of accumulating larger numbers of unemployed people, with the

social and economic costs that entails. The presence

of some public debt should not be construed as an

-1

indication that the country has been ‘living beyond its

-2

means’. Australia’s stock of net public debt is much

-3

smaller than that of most other OECD advanced -4

economies, as shown in Figure 4.

-5

Figure 4: Net government debt as a % of GDP in OECD countries Greece Japan Portugal Ireland Italy United States France United Kingdom Belgium Spain Hungary Israel Iceland Germany Austria Mexico Canada Netherlands Korea New Zealand Switzerland Turkey Poland Australia Denmark Estonia Slovenia Slovak Republic Luxembourg Czech Republic Chile Sweden Finland Norway

1973

1978

1983 1988 1993 1998 2003 Financial year ending in July

2008

2013

Source: Commonwealth Govt 2013, Final Budget Outcome 2012-13.

2012-13 saw the largest fall (3.2%) in inflationadjusted expenditure by the Commonwealth on record, with records going back to 1970. It is not accurate to suggest that the Commonwealth has not been ‘living within its means’, nor that there has been no move to tighter fiscal policy to reduce debt. More fiscal tightening in excess of that already experienced would likely have reduced economic activity and employment in Australia. The OECD, in its November

12.7

2013 Economic Outlook, warned that “it will… be important to avoid any additional tightening of fiscal policy in the short term above that already factored in.”4

-175 -50

50 100 Per cent of GDP

150

Source: IMF World Economic Outlook database. Figures include subnational (state and local) governments where applicable.

200

The

Commission

has

been

asked

“make

The task of tightening fiscal policy has already begun.

recommendations to achieve savings sufficient to

The Final Budget Outcome for 2012-13 shows that

deliver a surplus of 1 per cent of GDP prior to 2023-

the fiscal position improved by 1.7 percentage points

24”. Achieving this task should not require big cuts

of GDP. This is the largest single-year tightening of

beyond current policy.

fiscal policy for at least the past 40 years.

Stiglitz, J. 2010, ‘The Crisis Down Under’, Project Syndicate, August 5. Available from: http://www.projectsyndicate.org/commentary/the-crisis-down-under

OECD 2013, ‘Australia: Economic forecast summary’, Economic Outlook, OECD, Paris.

ACTU Economic Bulletin - December 2013 – Page 3

The Business Council of Australia’s Action Plan for

Fund expects just 12 to be running a structural

Enduring Prosperity includes a projection of the fiscal

surplus in 2018. Figure 7: IMF's projected general government structural balance

balance (shown below). This projects a surplus equal to around 1 per cent of GDP in 2023. The Treasury projects an underlying cash balance of around 1 per

Per cent of potential GDP 2

cent of GDP in 2021-22 and for each of the three

years prior to that. It also expects the Budget to be in

Australia

-1

structural surplus at that time.

Canada

-2

Figure 6: BCA’s projection of Commonwealth fiscal balance

-3 -4

United States

United Kingdom

-5 -6 -7 -8 2011

2012

2013

2014

2015

2016

2017

2018

Source: IMF World Economic Outlook database. Includes state & local.

To the extent that Australia has a fiscal policy problem, it is a long-run challenge that will result in deficits from the late 2020s, as illustrated in the BCA’s projection reproduced as Figure 6. Another challenge is ensuring that the scope of governments’ Source: Deloitte Access Economics, as reproduced in BCA (2013) as Figure 27. Cropped to focus on the period the Commission has been asked to consider.

Australia’s fiscal outlook is much more positive than the outlook elsewhere. The IMF estimates that Australia’s

general

government

sector

activities match Australians’ legitimate expectations of government. These challenges will not be best addressed through a rapid review process with recommendations for short-term cuts.

(which

incorporates State and local governments) will have a 5

As is clear from the analysis above, Australia does not

surplus equal to 0.75% of GDP by 2018 (the final

have a short-run ‘budget emergency’. We are on

year of its current projections) and a structural

track to meet the target set for the Commission in its

surplus equal to 0.755% of potential GDP by the same

terms of reference. Nevertheless, to the extent that

year. Figure 7 shows that, unlike Australia, the

tighter fiscal policy is desired, this should be achieved

governments of Canada, the UK and the US are

through restoring tax receipts, not by reducing

projected to be running structural deficits of at least

expenditure. The primary cause of our structural

1% of GDP in 2018. Of the 33 advanced economies

deficits is a fall in revenue (as a proportion of GDP).

for which the IMF database includes a projection, the

Reversing this revenue shortfall should be the focus of any attempt to close the structural budget gap. An adequate revenue base is needed to ensure that

Defined as ‘net lending by the general government sector’

ACTU Economic Bulletin - December 2013 – Page 4

Australian governments can provide the quantity and

tax is the largest component) averaged 12.1% of GDP.

quality of public services that citizens demand.

Revenue from this source has been that level for every fiscal year since 1999-2000. In 2011-12, this

The Parliamentary Budget Office recent estimated

source of revenue took in just 9.4% of GDP, the

that between 2002-03 and 2011-12, “the structural

lowest figure since 1972-73.

level of [Commonwealth] receipts fell by around 5 percentage points of GDP” while the structural level

Even if no income tax cuts are implemented in the

of payments (excluding GST) rose by around 1

coming years, the latest Budget forecasts only

percentage point of GDP. The bulk of the

anticipate individuals’ and other withholding taxes

deterioration in the structural budget balance has

reaching 11.6% of GDP in 2015-16, below the

therefore come about because of a decline in

Hawke/Keating/Howard average. Revenue from this

revenues, not an increase in expenditure. Of that

source has been deficient relative to its typical levels

decline in revenues, the PBO estimates that “over

of the past three decades. As the PBO found, this

two thirds… was due to the cumulative effect of the

deficiency is largely due to unsustainable tax cuts,

successive personal income tax cuts granted between

rather than the state of the economy. In 2012-13, if

2003-04 and 2008-09”.6

individuals’ and other withholding taxes had taken in

Figure 8: Individuals' and other withholding taxes as a proportion of GDP Per cent 14

the Hawke/Keating/Howard average, this would have meant an additional $27 billion in Commonwealth revenue. It is imperative that ‘bracket creep’ be

allowed to wind back the unsustainable cuts of the

2000s over the coming years.

11 10 9

Average during Hawke, Keating & Howard Governments = 12.1%

As outlined above, substantial personal income tax

8 2012-13 = 10.3%

7 6 5 1972-73

cuts were implemented in the mid-2000s. These cuts were far in excess of the amount that would have been necessary to compensate for bracket creep. To

1982-83

1992-93

2002-03

2012-13

further examine the effect of personal income tax

Source: Reinhardt and Steel, ‘A Brief History of Australia’s Tax System’ to 2006-07; ACTU calculations based on ABS 5204 and Budget papers thereafter

cuts on the budget, the ACTU has undertaken some

Revenue from personal tax is well below its typical

microsimulation model of Australia's income tax and

level of the past few decades. During the Hawke,

transfer system. We have used the model to answer

Keating and Howard Governments, individuals’ and

the following questions:

other withholding taxes (of which personal income



analysis

using

NATSEM’s

STINMOD

static

If the 2004-05 personal income tax rates had remained unchanged to 2012-13, and the

Parliamentary Budget Office 2013, ‘Estimates of the Structural Budget Balance of the Australian Government: 2001-02 to 201617’, Parliament of Australia, Canberra.

thresholds had been indexed to either prices or

ACTU Economic Bulletin - December 2013 – Page 5

wages7, how much additional revenue would the Commonwealth have collected in 2012-13? 

In the scenario described above, how much of the additional revenue would have come from high-income households?

Figure 9: Change in family disposable income in 2012-13 if the 2004-05 tax thresholds had been indexed ($) $ per week $0 -$20 -$40 -$60

For example, the threshold for the top marginal tax

-$80

rate was $70 000 in 2004-05. If this had increased in

-$100

line with the CPI, it would have been $88 084 in 2012-

-$120

13, or $101 180 if it was indexed to wages. Instead,

-$140 -$160

the threshold was lifted to $180 000.

CPI scenario

-$180

AWOTE scenario

-$200 1

By comparing the 2012-13 tax parameters with those of 2004-05, indexed by either prices or wages, we are measuring the effect of the real tax cuts since 2004-

3 4 5 6 7 Weekly total income decile

Source: ACTU calculations microsimulation model.

using

NATSEM’s

STINMOD

static

to the CPI, rather than being raised so dramatically,

Figure 10: Change in family disposable income in 2012-13 if the 2004-05 tax thresholds had been indexed (%) Per cent 0.0%

then tax revenues would have been $32.9 billion

-1.0%

higher in 2012-13 than they actually were. If the

-2.0%

thresholds were indexed in line with wages, the

-3.0%

05. We find that if the thresholds had been indexed

revenue gain would have been $22.3 billion.

-4.0% -5.0%

We estimate that 36.7% of this extra revenue (37.2%

CPI scenario

-6.0%

with wage indexation) would have come from the top 10% of households. The disposable incomes of the top 10% of households are $192.30 per week higher, on average, than they would have been if the 2004-

AWOTE scenario

-7.0% 1

3 4 5 6 7 Weekly total income decile

Source: ACTU calculations microsimulation model.

using

NATSEM’s

8 STINMOD

10 static

05 thresholds had been indexed to CPI ($132 per

The large real tax cuts since 2004-05 were strongly

week with wage indexation). Households in the

skewed towards higher income households. The skew

bottom 10% are $1.50 per week better off ($1 in the

remains evident if the change is expressed in

wages scenario) than they would have been if the

percentage, rather than dollar, terms.

thresholds had been indexed.

These cuts were a major factor in the deterioration of the structural budget position. They were skewed towards high income households. If the Commission

First scenario: tax thresholds indexed in line with the CPI (which 7 rose by 25.8% between Sept 2004 and Sept 2012). Second scenario: thresholds indexed in line with the average weekly ordinary time earnings (AWOTE) of full-time adults, which rose 44.5% over the same period. 8 These estimates are based on a ‘day after’ comparison. They do not incorporate the effects of behavioural change.

of Audit wishes to address the real cause of the structural deterioration in the Budget, it will recommend that these cuts are unwound through bracket creep in the coming years.

ACTU Economic Bulletin - December 2013 – Page 6

Figure 11: Tax concession on superannuation contributions Percentage points 40% Proposed changes 30%

Previous government's policy

Treasury analysis shows that high income earners benefit far more than low-income earners from superannuation tax concessions (including those associated

with

contributions,

earnings,

and

withdrawals).9 It shows that the top 10% of income

20%

earners received 38.2% of superannuation tax 10%

concessions in 2009-10. This is more than the share

of the bottom 60%, combined. The bottom 10%

-10%

received a negative share of the total, as they paid more on their super than on other income. The

-20% 15000

30000

60000 110000 180000 300000 Income

Source: ACTU calculations.

There is another area the ACTU believes is particularly worthy of consideration: the size and distribution of superannuation tax concessions. The present

system

for

taxing

superannuation

contributions is blatantly inequitable. An individual

analysis also shows that the support given to high income earners in the form of superannuation tax concessions exceeds that enjoyed by lower income earners in the form of the age pension. The Treasury found that “the top 1 per cent of income earners received the most combined support,” taking both the age pension and super concessions into account.

with an income of $60 000 faces a marginal tax rate of 32.5% (not including the Medicare Levy), and pays 15% on super contributions. This is a concession of 17.5 percentage points. A high-income earner on $180 000 or more receives a concession of 30 points.

Tax expenditures associated with super are estimated to be worth $31.8 billion in 2012-13, rising to $44.8 billion by 2015-16.10 Unions support the concessional taxation of superannuation, but these concessions must be sustainable and equitably distributed. This is

The system will be rendered more inequitable as a result of the Government’s abolition of the Low Income Superannuation Contribution and rejection of the plan to reduce the super tax concession for individuals with annual incomes greater than $300

not currently the case. The Commission must recommend reform to the size and distribution of these tax expenditures if it is to seriously grapple with the medium to long-term budget pressures facing the Commonwealth.

000. The LISC effectively refunds the tax paid on super contributions by individuals with incomes below $37 000. The abolition of this measure will mean that an estimated 3.6 million low income

Please send any comments, corrections, criticisms or compliments

Matt

Cowgill

mcowgill@actu.org.au.

earners will pay 15% tax on their super contributions, while facing a marginal tax rate on ordinary income of 0% or 19%.

The Treasury 2012, ‘Distributional Analysis of Superannuation Tax Concessions’. 10 The Treasury 2013, Tax Expenditures Statement 2012

ACTU Economic Bulletin - December 2013 – Page 7

The tables and charts below summarise the latest available data about the Australian labour market.

Figure 13: Change in employment in the year to October Thousands 200 148.7

150

Table 1: Summary of labour force figures Level

Monthly change

Yearended change

11639200

1100

89200

- Full time employment

8094700

-27900

-59500

-50

- Part time employment

3544500

28900

148700

-100

19059000

29500

338100

Employment-topopulation ratio

61.1%

-0.1

-0.6

Unemployment rate

5.7%

0.3

Unemployed persons

709300

9100

53500

24.1 3.2

Employed persons

Working age population

89.2 65.1

86.7 61.9

100

-62.7

-59.5

Full time Males

Part time Females Persons

Total

Source: ACTU calculations based on ABS 6202, seasonally adjusted.

Figure 14: Unemployment rate Per cent 6.5 6.0 5.5

Underemployment rate (quarterly) Participation rate

7.80

0.4

0.7

64.8%

-0.4

Source: ABS 6202, seasonally adjusted.

Oct 05

Oct 07

Oct 09

Trend Oct 11

Oct 13

Figure 15: Employment to population ratio

1.5

0.8 0.2 1.1

0 -1.2

Per cent 64 63

-20 -30

Seasonally adjusted

Source: ABS 6202.

-10

3.5 3.0 Oct 03

28.9

27.5

4.5 4.0

Figure 12: Change in employment between Sept and Oct 2013 Thousands 40 30

5.0

62 -26.6

-27.9

-40 Full time Males

Part time Females Persons

Total 60

Source: ACTU calculations based on ABS 6202, seasonally adjusted.

59 58 Oct 03

Seasonally adjusted Oct 05

Oct 07

Source: ABS 6202.

ACTU Economic Bulletin - December 2013 â&#x20AC;&#x201C; Page 8

Oct 09

Trend Oct 11

Oct 13

Figure 18: Underemployment and unemployment rates Per cent 14

Figure 16: Unemployment rates by State/Territory 7.0 Tas 8.2

5.6

6.6

6.1 5.9

Qld

Underemployment 8

5.5 5.8

Vic

5.1

NSW

5.8 4.0

NT WA

4.2 4.5

ACT

4.1 4.4 0

0 Aug 08

4 6 Per cent Oct 2012 Oct 2013

15+ (%) 66.0

76.5

65.5

76.0

65.0

75.5

64.5

75.0

64.0

74.5

63.5 15-64 (LHS)

Source: ABS 6202.

Aug 11

Aug 12

Aug 13

Public Administration and Safety

15-64 (%) 77.0

Oct 07

Aug 10

Figure 19: Employment growth in the year to August 2013

Figure 17: Participation rate

Oct 05

Aug 09

Source: ABS 6202, trend.

74.0 Oct 03

Unemployment

5.3

15+ (RHS) Oct 09

Oct 11

63.0 Oct 13

10.6%

Construction

5.0%

Other Services

4.3%

Transport, Postal and Warehousing

3.9%

Accommodation and Food Services

2.4%

Health Care and Social Assistance

2.0%

Wholesale Trade

1.7%

Retail Trade

1.7%

Electricity, Gas, Water and Waste…

0.6%

Financial and Insurance Services

0.4%

Professional, Scientific and…

0.1%

Arts and Recreation Services

-0.4%

Education and Training

-0.4%

Administrative and Support Services

-1.8%

Mining

-2.0%

Manufacturing

-4.4%

Rental, Hiring and Real Estate…

-5.3%

Agriculture, Forestry and Fishing Information Media and…

-7.6% -12.2%

-18% -13% -8% -3%

7% 12%

Yearly change in employment (%) Source: ACTU calculations based on ABS 6202, trend.

ACTU Economic Bulletin - December 2013 – Page 9

Source: ABS 5206 and ACTU calculations. Non-farm.

Table 2: Summary of September quarter National Accounts Quarterly change

Level

Yearended change

Figure 22: Annual growth in labour productivity (GDP per hour) Year-ended growth 5%

Real gross domestic product (GDP)

387031

0.6%

2.3%

Real GDP per capita

16683

0.2%

0.6%

Labour productivity (total economy)

0.0%

1.0%

Labour productivity in the market sector

0.0%

1.5%

Terms of trade

-3.3%

-3.5%

53.8%

0.0

-0.2

-1%

Wages share of income

Fair Work Act

Work Choices

Seasonally adjusted Profits share of income

26.7%

0.0

Source: ABS 5206.

-2% Sep 03

Sep 05

Sep 07

Trend

Sep 09

Figure 20: Growth in real GDP per year

Arts and recreation services

8.4%

Mining

20-year average, 3.4%

7.7%

Public administration and…

6.7%

Health care and social…

5.4%

Agriculture, forestry and fishing

Financial and insurance…

Rental, hiring and real estate…

5.3% 5.1%

Other services

Seasonally adjusted Sep 05

Sep 07

Trend

Sep 09

Sep 11

Sep 13

Retail trade

1.9%

Administrative and support…

1.8%

Transport, postal and…

1.7%

Professional, scientific and…

1.5%

Construction

Figure 21: Annual growth in nominal unit labour costs 8%

6% 20-year average, 2.5%

Information media and…

0.8% -0.4%

Manufacturing

-1.9%

Wholesale trade

-2.6%

Accommodation and food…

-3.3%

Electricity, gas, water and…

-4.6%

-15% -10% -5% 0% 5% 10% Annual GVA growth Source: ABS 5206.

0% Seasonally adjusted Trend Sep 97

2.7% 2.1%

Source: ABS 5206 and ACTU calculations.

-2% Sep 93

4.4%

Education and training

Sep 13

Figure 23: Growth in output (gross value added) – year to June 2013

0% Sep 03

Sep 11

Source: ABS 5206.

Sep 01

Sep 05

Sep 09

Sep 13

ACTU Economic Bulletin - December 2013 – Page 10

Figure 25: Headline and underlying CPI inflation Per cent 5%

Table 3: Summary of prices and wages data

Wage Price Index (WPI)

Latest quarter

Level

September

Year-ended change

2.7% 3%

Full-time average weekly ordinary time earnings (AWOTE)

May

$1,421

5.3%

Real full-time AWOTE

May

$1,421

2.9%

Total average weekly earnings (AWE)

May

$1,105

4.9%

From 1 July

$622.20

2.6%

March

4.5%

Headline CPI

September

2.2%

Trimmed mean (underlying CPI)

September

2.3%

Employees’ cost of living (LCI)

September

0.9%

May

17.5%

-0.1%

RBA's target band

Headline CPI

National Minimum Wage per 38 hour week Average wage increase in collective agreements

0% Sep 03

Underlying CPI Sep 05

Sep 07

Sep 09

Sep 11

Sep 13

Source: ABS 6401.

Figure 26: Wage Price Index growth 4.5%

4.0%

Gender pay gap

Source: ABS 6345, ABS 6302, FWC, DEEWR Trends in Federal Enterprise Bargaining, ABS 6401, ABS 6467, ACTU calculations.

Figure 24: Annual growth in the CPI and workers’ cost of living (Employee LCI)

3.5%

3.0%

2.5%

2.0% Jun 98

Long-run average

Trend

Seasonally adjusted

Jun 03

Jun 08

Jun 13

Source: ABS 6345.

Figure 27: WPI growth in the public and private sectors

5.0%

2% 1%

4.5%

Underlying CPI Employee LCI

4.0%

0% -1% Sep 03

3.5% Sep 05

Sep 07

Source: ABS 6467, ABS 6401.

Sep 09

Sep 11

Sep 13 3.0% 2.5%

Private Public

2.0% Sep 03

Sep 05

Source: ABS 6345.

ACTU Economic Bulletin - December 2013 – Page 11

Sep 07

Sep 09

Sep 11

Sep 13

Figure 28: WPI growth in the year to June by industry 0% 1% 2% 3% 4% Electricity, gas, water and…

3.4%

Construction

3.2%

Mining

3.2%

Manufacturing

Retail trade

Victoria

3.0%

Australia

2.7%

Qld

2.7%

Rental, hiring and real…

2.8%

2.7%

Tas

2.7%

NSW

Administrative and…

2.6%

Information media and…

2.5%

Transport, postal and…

2.5%

2.8%

ACT

2.7%

Australia

2.9%

2.8%

Financial and insurance…

3.2%

3.0%

Health care and social…

Other services

3.4%

3.0%

Public administration and…

Figure 30: WPI growth in the year to June by State 0% 1% 2% 3% 4%

2.6% 2.5% 2.3%

Source: ABS 6345.

Figure 31: Average weekly ordinary time earnings for full-time adults $0 $1,000 $2,000

Wholesale trade

2.4%

Arts and recreation services

2.4%

Education and training

2.4%

Professional, Scientific…

$1,706.60

2.3%

Information Media and…

$1,671.10

Financial and Insurance…

$1,645.30

Accommodation and food… Professional, scientific and…

Mining

1.9%

Source: ABS 6345.

Electricity, Gas, Water…

Figure 29: Range of WPI growth rates across industries 7%

Public Administration… Construction

Transport, Postal and…

5% 4% 3% 2% 1% 0% Sep 03

Education and Training

Health Care and Social…

$1,354.10

Arts and Recreation…

$1,315.50

Rental, Hiring and Real…

$1,303.80

Administrative and…

$1,276.50

Accommodation and… Sep 13

Source: ABS 6345 and ACTU calculations. Based on a 5-quarter centred moving average.

$1,425.10

$1,417.30

Other Services Sep 11

$1,436.00

Wholesale Trade

Australia Sep 09

$1,485.20

$1,420.90

Manufacturing

Sep 07

$1,622.90 $1,499.00

All Industries

Range of growth rates in all industries

Sep 05

$2,423.50

Retail Trade Source: ABS 6302.

ACTU Economic Bulletin - December 2013 – Page 12

$1,251.40 $1,104.70 $1,049.80 $1,022.00