The sky is falling, the sky is falling…on to the Australian economy.
So we are told on an almost hourly basis by the media herd and any economist keen to get his mug on the TV.
How strong is the evidence? And might these folks merely be extrapolating from a much more severe US experience?
The recent rounds of layoffs by various Aussie firms have been presented as irrefutable evidence of impending doom. News of firms hiring is much less exciting of course. Any chance this is more a case of searching for bad news than all news being bad?
One pretty solid piece of data snuck out yesterday amongst shopping centre giant Westfield‘s full year results. These were the annual sales growth figures for assorted categories of shops in their malls in Australia (p.33 of results):
Versus those for their US malls for the same period (p.34 of results):
Unless the firm’s catchment of consumers is startlingly different from Australia to the US (and there has never been much evidence of that), it would seem reasonable to say the Aussie numbers don’t show much correlation with the dire US figures. Conceivably our slowdown is lagging considerably, but again, where is the contagion in the story?
The stronger case could be made for Aussie retailers doing quite well, and antipodean consumers still flashing their money around.
Moral of this post: get beyond the media and check out the real numbers…