Most Australian workers "in recession"
October 7, 2011, 1:00 pm Yahoo!7
Recent data from AIG shows that many sectors of the Australian economy continue to shrink and job losses will be the unavoidable result.
The majority of Australian workers are employed in sectors that are experiencing "recessionary" conditions, with rising job losses and falling volumes of work, according to the Australian Industry Group.
While the booming mining sector is keeping economic growth positive, it only employs 2 per cent of the country's workers.
But the latest data measuring the performance of economy across a range of sectors makes for depressing reading, with all either contracting or weakening.
If the AIG's indices show readings above 50pts, it means the sector is expanding, and below 50 indicates contraction. (Follow Kochie's Business Builders On Twitter)
It's September surveys show that the construction sector continued to shrink for the 16th consecutive month, down by 2.1 points in September to just 30 points.
It was the lowest reading on construction industry conditions since the depth of the GFC in February 2009.
The Manufacturing index was also doing it tough, down by 1 point in September, to just 42.3. (For a related reading, see Businesses And Investors Urged To Prepare For Crash)
The sectors within manufacturing experiencing the deepest declines were food and beverages, wood products and furniture and transport equipment.
In fact, ten out of the 12 manufacturing sub-sectors declined in September.
Finally, it's Services Sector Index also declined 1.8 points to 50.3, just marginally staying in positive territory but perilously close to contraction. Retail is the services sector having the hardest time at the moment but others are also continuing to suffer and shed jobs. (Get Expert Advice From Kochie)
Shane Oliver, chief economist at AMP Capital, said that Australia's two-speed economy means that most people will feel as though Australia is in a recession.
"There is a lot of job-shedding going on and for most workers, this does not feel like a country in a boom" said Oliver.
"The Services sector employs about 70% of people and is struggling, even if it remains in positive territory. Retail is the biggest employer within that sector and we all know what a tough time it is having."
"Meanwhile manufacturing employs about 12% of workers and Construction employs about 7%. All in all, these employees and businesses large and small will be feeling the pinch. Most are losing money and all this gives even more weight to the argument that the RBA should cut rates at the next meeting."(Sign Up To Kochie's Newsletter)
While the booming mining sector is keeping economic growth positive, it only employs 2 per cent of the country's workers.
But the latest data measuring the performance of economy across a range of sectors makes for depressing reading, with all either contracting or weakening.
If the AIG's indices show readings above 50pts, it means the sector is expanding, and below 50 indicates contraction. (Follow Kochie's Business Builders On Twitter)
It's September surveys show that the construction sector continued to shrink for the 16th consecutive month, down by 2.1 points in September to just 30 points.
It was the lowest reading on construction industry conditions since the depth of the GFC in February 2009.
The Manufacturing index was also doing it tough, down by 1 point in September, to just 42.3. (For a related reading, see Businesses And Investors Urged To Prepare For Crash)
The sectors within manufacturing experiencing the deepest declines were food and beverages, wood products and furniture and transport equipment.
In fact, ten out of the 12 manufacturing sub-sectors declined in September.
Finally, it's Services Sector Index also declined 1.8 points to 50.3, just marginally staying in positive territory but perilously close to contraction. Retail is the services sector having the hardest time at the moment but others are also continuing to suffer and shed jobs. (Get Expert Advice From Kochie)
Shane Oliver, chief economist at AMP Capital, said that Australia's two-speed economy means that most people will feel as though Australia is in a recession.
"There is a lot of job-shedding going on and for most workers, this does not feel like a country in a boom" said Oliver.
"The Services sector employs about 70% of people and is struggling, even if it remains in positive territory. Retail is the biggest employer within that sector and we all know what a tough time it is having."
"Meanwhile manufacturing employs about 12% of workers and Construction employs about 7%. All in all, these employees and businesses large and small will be feeling the pinch. Most are losing money and all this gives even more weight to the argument that the RBA should cut rates at the next meeting."(Sign Up To Kochie's Newsletter)
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