George Magazine

2012 l 2013

George is the magazine for St.George Bank’s corporate customers. Aimed at executive-level readers, it features customer case studies, news, articles on emerging business and management trends, product information, lifestyle features and more.

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economy OUR SUMS DOING Hans Kunnen Chief Economist, St.George Bank The times, they are a-changing … but the good news is that many of the changes are for the better. We are living in unusual times. Despite strong economic growth at a national level, many people feel that something is just not right. We seem to be a nation on edge. What is troubling us and what might turn things around? george.economy 17 unease. We read of job losses at high-profile companies. We have seen our superannuation savings fall and, by most accounts, the value of our homes has fallen in the past few years. On top of this, the cloud of European debt hangs IT'S NOT over the global financial system, the US appears to be in self-denial regarding its public finances, and China, a source of global growth for the past decade, now appears to be slowing. Last, but not least, households and businesses are having to cope with ever-changing technology, an ageing population, volatile energy prices and, for businesses, increasing global competition. Before we slip into despair, it might be good to take a step back and gain some perspective. The good news is that over 94 per cent of the labour force is employed and their income is rising. It may not be rising rapidly and for some it may be static, but wages are not falling. It is true that jobs are being lost in some sectors of the economy but at the same time, jobs are being created in others. Job growth Over the past three years, job losses have occurred in the manufacturing, transport, warehousing and retail sectors. Between them, almost 130,000 jobs have disappeared. At the same time, however, 500,000 jobs have been created in professional and technical services, healthcare, community services, mining and education. This may be cold comfort to those sectors that have declined, but it does highlight the direction the economy is taking. Job losses in the manufacturing sector are not new. They have been going on in fits and starts since at least the 1980s. Some manufacturers have thrived over this period but others have succumbed to global competition, the cost of updating machinery, changes in technology and many other factors. Those who continue to thrive have lifted productivity, lifted quality standards and where appropriate, updated their product lines. But despite the challenges, it remains the case that TAKE A STEP BACK AND GAIN SOME PERSPECTIVE IT MIGHT BE GOOD TO difficult to find reasons behind our

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