16 things that happened in the Australian economy in June quarter 2022

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Released
7/09/2022
Source
Australian National Accounts: National Income, Expenditure and Product, June 2022

The Australian Economy - June quarter 2022

  1. The Australian economy grew 0.9% during the June quarter 2022, and 3.6% over the past year. Strength came from household consumption, which grew 2.2%, and exports.
  2. We took to the skies again. The June quarter was the first since the start of the pandemic when international and domestic borders were open and there were no restrictions of movement. We began travelling internationally again, and spending on international travel reached 38.6% of pre-pandemic levels.
  3. We went out more. Household consumption of transport services rose 37.3% during the quarter, reaching two-thirds of pre-pandemic levels. Spending on eating out and accommodation rose 8.8% and returned to pre-pandemic levels. Capacity restrictions ended, which saw spending on recreation and culture increase 3.6%.
  4. We purchased less food from shops. As dining out increased, purchases of food from supermarkets and specialty stores fell 1.2%. This was the third quarterly fall in a row.
  5. We saved less. The household saving rate continued to fall but was still above pre-pandemic levels. Households saved 8.7% of their income during the quarter, down from 11.1% in the March quarter 2022.
  6. Hours worked grew 2.9% during the quarter as the labour force recovered from the Omicron wave and devastating floods in New South Wales and Queensland. The unemployment rate for the month of June was 3.5%.
  7. Home building fell for the third quarter in a row, falling 2.9% during the June quarter. Unfavourable weather subdued growth on the east coast. Trade and material shortages, and workforce illnesses also contributed.
  8. Export volumes surged, growing 5.5% during the quarter, the fastest rate of growth since September 2000. Growth was driven by rural goods such as wool, meat and cereals, as well as mineral ores such as iron ore and lithium.
  9. The June quarter 2022 recorded a trade surplus of 7.1 per cent of GDP, the largest trade surplus in the history of the national accounts. On the back of this trade surplus, Australia recorded its thirteenth consecutive current account surplus in the June quarter 2022, following 175 consecutive quarters of current account deficits.
  10. The transport, postal and warehousing industry boomed during the quarter due to surges in demand for air transport services. The accommodation and food services industry grew on the back of increased domestic tourism, and the health care industry grew as elective surgeries resumed.
  11. Consumer prices rose 1.8% during the June quarter 2022 and 6.1% over the year. This was the fastest annual increase since June 2001. The major drivers of consumer price increases were housing and fuel. The GDP deflator, a broad measure of price pressures across the whole economy, rose 8.3% over the year.
  12. Wage growth continued to trail inflation, despite a strong labour market. The Wage Price Index rose 0.7% during the quarter and 2.6% over the year.
  13. Labour productivity has grown strongly. GDP per hour worked (labour productivity) grew 2.1% during financial year 2021/22, the strongest annual growth in 10 years.
  14. Miners continued to benefit from rising commodity prices. The share of national income going to business profits during the June quarter was a record high of 32.9%, while the share going to labour was 48.5%, the lowest share ever recorded despite solid growth in employee earnings.
  15. Support from governments remained above pre-pandemic levels. Subsidies to business fell, though remained $2.1 billion higher than pre-pandemic levels. Government consumption fell 0.8% following the response to east coast floods in the March quarter.
  16. ‘Cost of living’ tax relief meant excise taxes collected by the Commonwealth government fell 34.1% following the temporary halving of the fuel excise at the end of the March quarter.