At the moment (June 3, 2026), the Australian Bureau of Statistics (ABS) launched the newest – Australian Nationwide Accounts: Nationwide Earnings, Expenditure and Product, March 2026. This information does probably not seize the complete influence on the Center East disruptions nor do they seize any rate of interest impacts arising from the current hikes in charges from the RBA. However the economic system is slowing and actually solely being held up by the huge personal funding in information centres, which can exhaust in coming quarters. The Australian economic system grew by 0.3 per cent within the March-quarter 2026 (down) from 0.4 per cent) and by 2.5 per cent (down from 2.6) over the 12 months. I count on the economic system to sluggish additional within the June-quarter 2026.
The principle options of the Nationwide Accounts launch for the March-quarter 2026 have been (seasonally adjusted):
- Actual GDP elevated by 0.3 per cent for the quarter (0.9 per cent final quarter). The annual development price was 2.5 per cent (2.6 final quarter).
- GDP per capita fell 0.1 per cent (+0.5 per cent final quarter) and 1 per cent for the 12 months.
- Australia’s Phrases of Commerce rose 1.1 per cent for the quarter and 0.2 per cent over the 12 month interval.
- Actual internet nationwide disposable revenue, which is a broader measure of change in nationwide financial well-being, rose by 0.4 per cent for the quarter (0.5 final quarter) and a pair of.0 per cent over the 12 months (2.5 final quarter).
- The Family saving ratio (from disposable revenue) fell to six.2 per cent from 7 per cent.
- GDP per hour labored fell 0.6 per cent (zero final quarter) and rose 0.3 per cent for the 12 months.
General development image – stronger development continues
The ABS media launch – Australian economic system grew 0.3% within the March quarter – mentioned that:
Australian gross home product (GDP) rose 0.3 per cent within the March quarter 2026 and a pair of.5 per cent in comparison with a 12 months in the past (seasonally adjusted, chain quantity measure) …
Financial development slowed within the March quarter, with modest family and public sector expenditure in addition to cyclone disruptions to mining and export actions. …
Family spending rose 0.5 per cent within the March quarter. This development contains elevated spending on electrical energy, fuel and different fuels (up 11.7 per cent) as authorities rebates ceased, elevating out‑of‑pocket expenditure for households.
Family spending on important items and providers elevated by 0.8 per cent, whereas discretionary spending rose by 0.1 per cent …
Authorities last consumption expenditure fell 0.2 per cent, the bottom quarterly development since September quarter 2022 …
Exports fell 1.1 per cent, the biggest quarterly decline in two years …
Non-public enterprise funding rose 6.0 per cent, pushed by a 16.3 per cent enhance in equipment and tools …
The family saving to revenue ratio fell to six.2 per cent, down from 7.0 per cent within the December quarter
The brief story:
1. Home demand is weakening within the face of upper rates of interest and rising inflation, which squeezed discretionary spending.
2. Contraction in assist from the federal authorities.
3. Funding (personal and public) constructing new capability robust – information centres – and no-one actually is aware of what influence they are going to have on electrical energy costs as soon as working.
Quarterly GDP Development
The subsequent graph exhibits the quarterly development because the June-quarter 2022.
Within the March-quarter 2026, GDP development weakened markedly.
To place this into historic context, the subsequent graph exhibits the last decade common annual actual GDP development price because the Sixties (the horizontal purple line is the typical for the complete interval (3.26 per cent) from the September-quarter 1960 to the March-quarter 2026.
Though COVID severely interrupted the economic system, as soon as we take out the quarters between March 2020 and March 2022 (inclusive), then the typical since 2020 has been 2 per cent each year – very mediocre.
It’s also apparent how far beneath historic tendencies the expansion efficiency of the final 2 a long time have been because the fiscal surplus obsession has intensified on either side of politics.
Even with an enormous family credit score binge and a once-in-a-hundred-years mining growth that was pushed by stratospheric actions in our phrases of commerce, our actual GDP development has declined considerably beneath the long-term efficiency.
The Sixties was the final decade the place authorities maintained true full employment.
GDP per capita declined 0.1 per cent
Within the March-quarter 2026, GDP per capita fell by 0.1 per cent.
Whereas commentators give attention to this statistics, the which means of the typical is questionable, given the extremely skewed revenue distribution in direction of the highest finish.
What we are able to say is that if the typical is declining, then these on the backside are doing it very robust certainly.
The next graph of actual GDP per capita (which omits the pandemic restriction quarters between December-quarter 2020 and December-quarter 2021) tells the story.
Evaluation of Expenditure Parts
The next graph exhibits the quarterly share development for the most important expenditure parts in actual phrases for the December-quarter 2025 (gray bars) and the March-quarter 2026 (blue bars).
Home demand accelerated but it surely was as a result of large funding growth in AI and information centres.
Contributions to development
The next bar graph exhibits the contributions to actual GDP development (in share factors) for the principle expenditure classes. It compares the March-quarter 2026 contributions (blue bars) with the earlier quarter (grey bars).
You may see the huge shift in stock contribution, which accounted for 50 per cent of the general December-quarter development price however departed the scene within the March-quarter 2026.
- Family consumption expenditure added 0.3 factors (0.1 final quarter).
- Non-public funding expenditure added 0.7 factors (0.1).
- Internet exports undermined development by 0.1 level (final quarter -0.2) – the 0.3 level export contribution outweighed the -0.4 factors import subtraction (bear in mind constructive import expenditure development constitutes a lack of development).
- General authorities contribution was 0.1 factors (0.3) – the recurrent contribution was 0 factors (0.2) whereas the capital contribution was static on 0.1 level).
Materials dwelling requirements rose 0.4 factors within the March-quarter 2026
The ABS inform us that:
A broader measure of change in nationwide financial well-being is Actual internet nationwide disposable revenue. This measure adjusts the quantity measure of GDP for the Phrases of commerce impact, Actual internet incomes from abroad and Consumption of mounted capital.
Whereas actual GDP development (that’s, whole output produced in quantity phrases) rose by 0.3 per cent within the present quarter, actual internet nationwide disposable revenue development rose by 0.4 per cent.
How can we clarify that?
Reply: The phrases of commerce grew by 1.1 per cent within the present quarter which complemented the rise in compensation of staff (COE) of 0.6 per cent (5.9 per cent for the 12 months).
Productiveness development declines general
The sectoral productiveness development final result have been:
- Market sector – 1.51 per cent (annual), 0.2 per cent (quarter).
- Non-market sector – -0.31 per cent (annual), -0.51 per cent (quarter).
- General – 0.3 per cent (annual), -0.6 per cent (quarter).
The next graph presents quarterly development charges in actual GDP and hours labored utilizing the Nationwide Accounts information from the June-quarter 2022 to the March-quarter 2026.
To see the above graph from a distinct perspective, the subsequent graph exhibits the annual development in GDP per hour labored (labour productiveness) from the start of 2008 to the March-quarter 2026.
The horizontal purple line is the typical annual development because the September-quarter 2008 (0.77 per cent), which itself is an understated measure of the long-term development development of round 1.5 per cent each year.
Family saving ratio improves by 0.8 factors
The next graph exhibits the family saving ratio (% of disposable revenue) from the December-quarter 2000 to the present interval.
It exhibits the interval main as much as the GFC, the place the credit score binge was in full swing and the saving ratio was unfavorable to the rise throughout the GFC after which the newest rise.
An rising saving ratio offers the family sector general with an elevated capability to danger handle within the face of uncertainty.
The subsequent graph exhibits the saving ratio since 1960, which illustrates the way in which during which the neoliberal interval has squeezed family saving.
Going again to the pre-GFC interval, the family saving ratio was unfavorable and consumption development was maintained by rising debt – which is an unsustainable technique on condition that family debt is so excessive.
Although the ratio has been rising barely in current quarters, it’s nonetheless effectively beneath previous ranges.
The next desk exhibits the influence of the neoliberal period on family saving. These patterns are replicated world wide and expose our economies to the specter of monetary crises way more than in pre-neoliberal a long time.
| Decade | Common Family Saving Ratio (% of disposable revenue) |
| Sixties | 13.9 |
| Seventies | 16.0 |
| Nineteen Eighties | 11.8 |
| Nineties | 4.8 |
| 2000s | 1.2 |
| 2010s | 6.2 |
| 2020s on | 8.5 |
| Since RBA hikes | 4.6 |
The distribution of nationwide revenue – wage share rises by 0.3 factors
The wage share in nationwide revenue rose to 54.2 per cent within the March-quarter 2026.
The revenue share fell 0.3 factors to 26.9 per cent.
The primary graph exhibits the wage share in nationwide revenue whereas the second exhibits the revenue share.
The declining share of wages traditionally is a product of neoliberalism and can in the end must be reversed if Australia is to take pleasure in sustainable rises in requirements of dwelling with out file ranges of family debt being relied on for consumption development.
Conclusion
Do not forget that the Nationwide Accounts information is three months previous – a rear-vision view – of what has handed and to make use of it to foretell future tendencies just isn’t simple.
Additional, this information does probably not seize the complete influence on the Center East disruptions nor do they seize any rate of interest impacts arising from the current hikes in charges from the RBA.
However the economic system is slowing and actually solely being held up by the huge personal funding in information centres, which can exhaust in coming quarters.
The Australian economic system grew by 0.3 per cent within the March-quarter 2026 (down) from 0.4 per cent) and by 2.5 per cent (down from 2.6) over the 12 months.
I count on the economic system to sluggish additional within the June-quarter 2026.
Clarification on terminology
I advocate a degrowth technique for the worldwide economic system general on condition that our footprint is 1.7 occasions the capability of the biosphere to regenerate.
To realize that technique, on condition that many poorer nations should proceed to develop, would require reasonably substantial minimize backs in spending and consumption within the richer nations.
Once I analyse the Nationwide Accounts information or any expenditure/output information, I write as if development is ‘good’.
However that terminology is used within the context that with out financial development and with none substantial shifts in revenue distribution and authorities transition insurance policies, attempting to pursue a recessionary technique would harm the weakest members of our society disproportionately.
In some respects, I’m abstracting from the damaging actuality of our ecological footprint.
That’s sufficient for right this moment!
(c) Copyright 2026 William Mitchell. All Rights Reserved.
