The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
As Australia's Reserve Bank grapples with economic challenges, its decisive interest rate hikes have led to a contraction in demand, achieving their intended result but with considerable impact on the private sector.
The private sector, a critical component of the nation's economy, has been particularly hard-hit. Industries such as construction and hospitality have seen a surge in insolvencies over the past two years, reflecting the broader struggle within this sector.
Job creation paints a stark picture of this downturn. Since the first quarter of 2023, only 91,433 jobs have emerged in the market-driven sectors, vastly outnumbered by the rise in the civilian population by 956,000 during the same period.
However, the larger economic narrative reveals a different trend. The overall demand across Australia remains relatively robust, primarily buoyed by the thriving non-market sector, which includes government activities and significant net overseas migration.
This divergence has been highlighted by Alex Joiner from IFM Investors, who notes that the non-market sector has generated 624,574 jobs since Q1 2023. This represents a striking 87% of the country's total job growth and is largely attributed to the expansion of initiatives like the National Disability Insurance Scheme (NDIS).
The dichotomy extends to GDP growth as well. Public sector spending is the primary driver of Australia's gross domestic product during this period, overshadowing the private sector's stagnation.
Independent economist Tarric Brooker describes the current situation as "burnout economics," where the Reserve Bank's efforts to cool the economy with elevated interest rates are met with increased public spending by government bodies.
Such significant public sector expansion is affecting productivity negatively. Australia's recent performance in labor productivity places it among the lower ranks compared to other advanced economies, raising concerns about long-term economic sustainability.
If evaluating the market sector alone, the RBA might have opted to lower interest rates; however, the overall economic picture necessitates a broader view. The non-market sector's unprecedented growth has counteracted the central bank's measures to temper demand and inflation.
The original analysis, sourced from the Australian Financial Review, fundamentally underscores the conflict between the RBA's intention to control inflation and the government's expansionary fiscal policies, which continue to bolster the non-market sector, leaving the private sector in a recessionary state.
Published:Tuesday, 21st Jan 2025 Source: Paige Estritori
Please Note: If this information affects you, seek advice from a licensed professional.
MotorCycle Holdings Limited (ASX: MTO), Australia's largest motorcycle retailer, has announced a record sales revenue of $650 million for the financial year 2025, representing an 11.6% increase from the previous year. This achievement underscores the company's strategic initiatives and resilience in a challenging market. - read more
The New South Wales Government has unveiled the most significant motorcycle safety reforms in nearly two decades, introducing targeted measures designed to protect novice riders and enhance overall road safety. These reforms are a cornerstone of the state's 2026 Road Safety Action Plan, which aspires to eliminate deaths and serious injuries on NSW roads by 2050. - read more
The 2025 Australian Motorcycle Grand Prix, held from 17-19 October at the Phillip Island Grand Prix Circuit, attracted approximately 91,245 visitors, marking the highest attendance since 2012. This surge in spectators provided a substantial economic boost to the Phillip Island region, benefiting local businesses such as hotels, restaurants, and retail outlets. - read more
There's nothing quite like the thrill of buying your dream motorcycle. The freedom of the open road, the wind in your hair, and the sense of adventure are all within your reach. But before you can ride off into the sunset, you'll likely need some financial assistance to make that dream bike a reality. - read more
Embarking on a motorcycle road trip across the breathtaking landscapes of Australia can be an exhilarating experience. The sense of freedom and adventure that comes with cruising on two wheels is unparalleled. However, before the rubber meets the road, it's essential to lay the financial groundwork for your journey. This not only ensures peace of mind but also enables you to enjoy the ride without monetary worries. - read more
When it comes to purchasing a motorcycle, finding the right financing is crucial. This article aims to guide you through the process of choosing the best motorcycle finance provider in Australia. Making an informed choice can have a significant impact on your loan terms and conditions, ensuring you get the best possible deal. With numerous finance providers available, it's essential to understand the importance of selecting the right one for your needs. - read more
START HERE
Get a free bike loan eligibility assessment and compare offers tailored
specifically to your circumstances.
Knowledgebase
Debt Consolidation: A means empoyed to renegotiate debt. By combining loans and outstanding bills, a person can consolidate debt with a single financial institution resulting in a single monthly repayment.
