15 Dec WHY THE LATEST EMPLOYMENT FIGURES ARE BOTH GOOD AND BAD NEWS; PAY UP FOR NEWS
WHY THE LATEST EMPLOYMENT FIGURES ARE BOTH GOOD AND BAD NEWS
Riddle me this: When is good news also bad news? Answer: When a low unemployment rate reduces the odds that the Reserve Bank or Australia (RBA) will lower interest rates in the first quarter of next year.
Australia’s unemployment rate fell to 3.9 per cent in November – the lowest level since March of this year, implying a strong jobs market with 35,600 more people employed.
Ordinarily, this would be good news, but a lower unemployment rate also means that the RBA is less likely to lower interest rates in February, which in turn translates to extended cost-of-living pain for Australian households into next year.
According to KPMG, the bumper jobs report is due to a jump in government spending, while Jarden notes that the “non-market” roles in health, education, and the public sector made up a full 84 per cent of employment gains since the start of 2023.
In fact, the AFR reports that the private sector has been pulling back its hiring, and that all that public sector hiring is actually hurting our productivity, which in turn, makes it harder to bring inflation under control.
In other words, great news if working for the government. Less so, for everyone else.
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This week, the Albanese government revealed a plan to force the likes of Google and Meta to pay hundreds of millions in taxes to help fund journalism unless they negotiate deals with local publishers.
The “news bargaining incentive”, which builds on the former Government’s attempt to force the tech giants to the table, applies a charge to digital platforms that may be refunded by an offset if they instead decide to pay news companies directly.
Unsurprisingly, the Government’s plan has had a mixed response from the tech platforms.
However, low and behold, the announcement was welcomed by Michael Miller, Executive Chair of News Corp Australasia, who said the incentive addresses concerns over job losses and reduced revenue following Meta’s withdrawal from other deals this year.
COLES REVELS AS WOOLIES REBUILDS
A 17-day strike at Woolworths has left the company facing up to $60 million in lost earnings, empty shelves, and customers turning around and fleeing to rival stores, The Australian reports.
Competitors may be capitalising on increased customers and revenue, but it’s not all positive. This disruption has also caused supply chain woes for Coles, with Chief Commercial Officer, Anna Croft, signaling the need for increased stock orders, additional checkouts, and more staff in stores and in warehouses to account for rising demands.
As earnings season looms, and Christmas is a short two weeks away, Woolworths is working overtime to restock shelves and restore customer loyalty while Coles is cashing in and learning to navigate supply chain demands.
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