Oh, and the annual inflation rate in Sweden eased to 10.6% in March 2023 from 12% in the previous month.

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ok said..
I have family members who run fairly large businesses. You said not to say the R word but word from those above are saying we are currently in a PSEUDO RECESSION.

All thanks to government overreach in the pandemic. The best business to be in both situations is pharmaceuticals or someone who provides access to those pharmaceuticals that only treat symptoms but never prevent or get rid of illnesses completely.

You weren't paying attention. We were almost in recession before Covid and the Morrisson government were not doing a very good job at all. It sort of saved their arse a bit as the pandemic took over... not that it really helped them.

I don't like them much, but to their credit they got in and spent when they needed to keep the economy going. It would have been very serious otherwise.

Now the existing government has to keep on stimulating a bit and taking away a bit, while the RBA does its own juggling act.

'Over-reach in the pandemic'? Really? You have that 20/20 vision of the past and what people should have done? Congrats, you are only one of 20 million or so that have excellent hindsight.

It's much better if you can accurately predict the future. Far better.

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ok said..
..You said not to say the R word but word from those above are saying we are currently in a PSEUDO RECESSION....

I think the definition of a recession is limited to being two or more quarters of declining GDP.

Pretty narrow definition really, but I guess there has always been an assumption that when this happens other things occur (or drive it) as well.

Otherwise being in a recession and also having a record low of 3.5% unemployment rate and relatively high inflation seem totally opposite.

More people working, a shortage of goods, but less overall output.

Sign of a significantly changing society and macro-economic theory not keeping up ? or just hyperbole media headlines driving hyper-inflationary media headlines ?


www.abs.gov.au/statistics/labour/employment-and-unemployment/labour-force-australia/latest-release

The unemployment rate needs to rise to reduce inflation, painful as it will be. Unemployment is at 3.5%, which when you take into accounts the unemployable population makes unemployment figure almost zero, this means there is huge pressures on wage growth as employers poach employees from other businesses.

Plenty of businesses closing, not due to them not being profitable, but not being able to get staff for the wage they can afford to pay. Yes they could put prices up to increase wages and retain staff, and up goes inflation again.

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airsail said..
The unemployment rate needs to rise to reduce inflation, painful as it will be. Unemployment is at 3.5%, which when you take into accounts the unemployable population makes unemployment figure almost zero, this means there is huge pressures on wage growth as employers poach employees from other businesses.

Plenty of businesses closing, not due to them not being profitable, but not being able to get staff for the wage they can afford to pay. Yes they could put prices up to increase wages and retain staff, and up goes inflation again.

As an example, Medical and allied health services are among some that are suffering.

Can't bulk bill clients as the Medicare subsidy doesn't even remotely cover the cost of consultation.

Can't hire more staff as the only ones available are asking for more money than the clinic can afford.

Can't charge clients more as many are already having to choose between paying for food, accommodation, appointments and/or medication.

Crazy that people have to decline medical intervention/assistance (except in emergency) just so they can eat that week.

Yep, true I guess (to airsail^^).

If there was a declining population then you could see a situation in which a lack of workers drives low unemployment, rising inflation and an overall declining output.

Just seems unusual to have high immigration, low unemployment, and a "decline in total output" (i.e. recession). I get how certain individual businesses may be struggling in the circumstances, rising interest rates and low unemployment never helps, but those workers must be going somewhere (presumably to other business to produce something) if unemployment is continuing to fall.

Maybe we need to see what is included in GDP figures ? If there is a transition of worker production from one type of output to another and the official GDP calculation doesn't include the new types of output being generated then maybe it is similar to the official inflation figures that heavily weights towards certain prices and thus in certain circumstances it may not be as relevant value as other times ?

I see reports today an RBA deputy governor saying unemployment must rise for inflation to come down. Only a few months ago the narrative was that unemployment must fall to drive a rise in real wage.

Macro-economics hey ? the crystal ball is as influential as the calculator.

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D3 said..
As an example, Medical and allied health services are among some that are suffering.

Can't bulk bill clients as the Medicare subsidy doesn't even remotely cover the cost of consultation.

Can't hire more staff as the only ones available are asking for more money than the clinic can afford.

Can't charge clients more as many are already having to choose between paying for food, accommodation, appointments and/or medication.

Crazy that people have to decline medical intervention/assistance (except in emergency) just so they can eat that week.

Maybe a good example D3.

Are all medical and allied health services included in GDP figures ?

Growing industry, some pretty groundbreaking advances, taking more people than are available - but does that mean it lifts GDP relative the amount it maybe should ?

Maybe it does, maybe it doesn't. I dunno.

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airsail said..
The unemployment rate needs to rise to reduce inflation, painful as it will be. Unemployment is at 3.5%, which when you take into accounts the unemployable population makes unemployment figure almost zero, this means there is huge pressures on wage growth as employers poach employees from other businesses.

Plenty of businesses closing, not due to them not being profitable, but not being able to get staff for the wage they can afford to pay. Yes they could put prices up to increase wages and retain staff, and up goes inflation again.

Is wage growth really having that much of an impact?

I was asking this question before about what it is, whether it's rising prices of goods and services or an increase in consumption. I think the concensus was that it was an increase in costs. Housing is only part of it and services seemed like a large component.

Direct wage growth is not considered and its only the flow on effect onto prices/costs that affects the CPI, i.e. the inflation level.

From what I can see it is businesses putting up their prices. Is this because they have direct increases in costs from labour or are they just jacking-up prices because they can. My cynical view suggests that some are just pushing up prices and others are having to.

There was mention in the media the other day that GPD per capita has fallen. I.e. output per person has fallen. GDP normally indicates a growing economy and is used as this measure, but when it is per person and it is falling it tells you that things are slowing and the pump-priming of immigration is the thing that is trying to keep things going.

Which I guess is why I asked the original question of whether it was an increase in costs or an increase in demand, although the difference seemed to be lost on some at the time.

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D3 said..

airsail said..
The unemployment rate needs to rise to reduce inflation, painful as it will be. Unemployment is at 3.5%, which when you take into accounts the unemployable population makes unemployment figure almost zero, this means there is huge pressures on wage growth as employers poach employees from other businesses.

Plenty of businesses closing, not due to them not being profitable, but not being able to get staff for the wage they can afford to pay. Yes they could put prices up to increase wages and retain staff, and up goes inflation again.

As an example, Medical and allied health services are among some that are suffering.

Can't bulk bill clients as the Medicare subsidy doesn't even remotely cover the cost of consultation.

Can't hire more staff as the only ones available are asking for more money than the clinic can afford.

Can't charge clients more as many are already having to choose between paying for food, accommodation, appointments and/or medication.

Crazy that people have to decline medical intervention/assistance (except in emergency) just so they can eat that week.

Is it really that bad? I can only speak from my own perspective, but the local clinics all seem to have gone away from bulk-billing for the obvious reason, but a few offer it but you have to book well ahead or prove you are in some category that needs it.

It then ends up being supply and demand. If there are enough doctors and they are willing to work for less, they will bulk-bill and take the much lower income. If there is an undersupply of doctors, people will pay what it takes or go without, which in Australia probably means turning up at an emergency department instead.

But for health services in general, insurance prices always seem to increase and the government have locked us into paying for something whether it is efficient or not and allowing price increases by default.

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FormulaNova said..

D3 said..

airsail said..
The unemployment rate needs to rise to reduce inflation, painful as it will be. Unemployment is at 3.5%, which when you take into accounts the unemployable population makes unemployment figure almost zero, this means there is huge pressures on wage growth as employers poach employees from other businesses.

Plenty of businesses closing, not due to them not being profitable, but not being able to get staff for the wage they can afford to pay. Yes they could put prices up to increase wages and retain staff, and up goes inflation again.

As an example, Medical and allied health services are among some that are suffering.

Can't bulk bill clients as the Medicare subsidy doesn't even remotely cover the cost of consultation.

Can't hire more staff as the only ones available are asking for more money than the clinic can afford.

Can't charge clients more as many are already having to choose between paying for food, accommodation, appointments and/or medication.

Crazy that people have to decline medical intervention/assistance (except in emergency) just so they can eat that week.

Is it really that bad? I can only speak from my own perspective, but the local clinics all seem to have gone away from bulk-billing for the obvious reason, but a few offer it but you have to book well ahead or prove you are in some category that needs it.

It then ends up being supply and demand. If there are enough doctors and they are willing to work for less, they will bulk-bill and take the much lower income. If there is an undersupply of doctors, people will pay what it takes or go without, which in Australia probably means turning up at an emergency department instead.

But for health services in general, insurance prices always seem to increase and the government have locked us into paying for something whether it is efficient or not and allowing price increases by default.

My local physiotherapy clinic claims they have been operating short staffed for a number of years due to lack of new graduates to hire. To the point where it is financially more efficient to hire international and pay all the additional costs for Visas and registration (approx $20K) than to try and poach an experienced physio from another clinic.

And they also say that they have lost a lot of their regular clients (chronic injury/pain management/age related) as they choose to cover living expenses instead and just live with the pain in the meantime.

Local gym just closed last week after 10 years operating, citing clients choosing to cut membership when it comes to squeezing more efficiency out of their household budget.

These businesses survived last year with no pandemic support, even though they were still suffering pandemic related effects. But the last 6 - 9 months of increases in: Rent, Interest Rates, Insurance, Power and staff salaries combined with less people being able to afford their services has really tightened the screws .

I know these are not isolated, but to my personal perspective it seems to show that these impacts are definitely being felt asymmetrically across communities.

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D3 said..

My local physiotherapy clinic claims they have been operating short staffed for a number of years due to lack of new graduates to hire. To the point where it is financially more efficient to hire international and pay all the additional costs for Visas and registration (approx $20K) than to try and poach an experienced physio from another clinic.

And they also say that they have lost a lot of their regular clients (chronic injury/pain management/age related) as they choose to cover living expenses instead and just live with the pain in the meantime.

Local gym just closed last week after 10 years operating, citing clients choosing to cut membership when it comes to squeezing more efficiency out of their household budget.

These businesses survived last year with no pandemic support, even though they were still suffering pandemic related effects. But the last 6 - 9 months of increases in: Rent, Interest Rates, Insurance, Power and staff salaries combined with less people being able to afford their services has really tightened the screws .

I know these are not isolated, but to my personal perspective it seems to show that these impacts are definitely being felt asymmetrically across communities.

Next time you see your physio clinic, ask them how long their last immigrant sponsor stayed with them after they got their PR, and then ask them why they are trying to grow their business.

The thing that really bugs me about poorly managed immigration is that it ignores the way workplace markets work.

When people enter university they look at different options and usually they look at their employment prospects and income level once they have received their degree. If there is no demand for that profession they will probably choose something else.

Now consider what happens in an economic downturn. We have them regularly enough. Jobs dry up and the new graduates choose different studies. Then the economy picks up and there is lower supply of some things, maybe physios. Then wages go up, and then more students choose to become physios. Then you go through another downturn and there are an excess of physios and then less graduates in the following years.

It applies to everything unless it is a restricted trade or profession.

If you throw 'cheap' immigrants at the problem it just makes things worse in the good times as there is not a demand for these roles to generate enough interest at university level.

Your physio seems to want to grow the business because it becomes a better earner. Guess what? A trained physio will run off with another bunch of physios and start their own business. It is the way of the world. Why do they deserve to be able to grow their business in good times if there is nothing they add? From what you have wrote they are saying both that their business is losing custom from people cutting back their spending BUT they want to add another staff member? Is the lower cost of a sponsored employee factored into that?

Gyms? Gyms have sprung up everywhere. There seem to be 24x7 gyms all over the place and I suspect they are suffering to get staff too, but does this mean we should import 200,000 gym managers, or should market forces apply to the businesses?

Immigration as its currently done, really annoys me as it has ruined the IT industry here and if times get bad there will be even more driving Ubers. Companies claim that they can't get the trained staff they want, while at the same time doing no training of their own, and want to sponsor cheap immigrants (at least until they get their PR). To make it worse, the society that supposedly represents the workforce is commissioned to assess incomig immigrants for their skills, so they have a benefit from encouraging more immigration and not favoring locals. You even see this when they write some BS article about needing more people and skills shortages and they get hammered with comments from workers here arguing it is a lie. They even moderate their comments, but you still get most people saying that there is no shortage.

I had better get off my hobby horse now

On an arguably different matter, I heard on the radio today that insurances, across the board are increasing by 20% this year. That's a whole lot more pain than a lot of folks will be able to manage for something I for one very rarely claim on.

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Buster fin said..
On an arguably different matter, I heard on the radio today that insurances, across the board are increasing by 20% this year. That's a whole lot more pain than a lot of folks will be able to manage for something I for one very rarely claim on.

That could be related to senior managers getting a pay increase of 15 percent.

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FormulaNova said..

D3 said..

My local physiotherapy clinic claims they have been operating short staffed for a number of years due to lack of new graduates to hire. To the point where it is financially more efficient to hire international and pay all the additional costs for Visas and registration (approx $20K) than to try and poach an experienced physio from another clinic.

And they also say that they have lost a lot of their regular clients (chronic injury/pain management/age related) as they choose to cover living expenses instead and just live with the pain in the meantime.

Local gym just closed last week after 10 years operating, citing clients choosing to cut membership when it comes to squeezing more efficiency out of their household budget.

These businesses survived last year with no pandemic support, even though they were still suffering pandemic related effects. But the last 6 - 9 months of increases in: Rent, Interest Rates, Insurance, Power and staff salaries combined with less people being able to afford their services has really tightened the screws .

I know these are not isolated, but to my personal perspective it seems to show that these impacts are definitely being felt asymmetrically across communities.

Next time you see your physio clinic, ask them how long their last immigrant sponsor stayed with them after they got their PR, and then ask them why they are trying to grow their business.

The thing that really bugs me about poorly managed immigration is that it ignores the way workplace markets work.

When people enter university they look at different options and usually they look at their employment prospects and income level once they have received their degree. If there is no demand for that profession they will probably choose something else.

Now consider what happens in an economic downturn. We have them regularly enough. Jobs dry up and the new graduates choose different studies. Then the economy picks up and there is lower supply of some things, maybe physios. Then wages go up, and then more students choose to become physios. Then you go through another downturn and there are an excess of physios and then less graduates in the following years.

It applies to everything unless it is a restricted trade or profession.

If you throw 'cheap' immigrants at the problem it just makes things worse in the good times as there is not a demand for these roles to generate enough interest at university level.

Your physio seems to want to grow the business because it becomes a better earner. Guess what? A trained physio will run off with another bunch of physios and start their own business. It is the way of the world. Why do they deserve to be able to grow their business in good times if there is nothing they add? From what you have wrote they are saying both that their business is losing custom from people cutting back their spending BUT they want to add another staff member? Is the lower cost of a sponsored employee factored into that?

Gyms? Gyms have sprung up everywhere. There seem to be 24x7 gyms all over the place and I suspect they are suffering to get staff too, but does this mean we should import 200,000 gym managers, or should market forces apply to the businesses?

Immigration as its currently done, really annoys me as it has ruined the IT industry here and if times get bad there will be even more driving Ubers. Companies claim that they can't get the trained staff they want, while at the same time doing no training of their own, and want to sponsor cheap immigrants (at least until they get their PR). To make it worse, the society that supposedly represents the workforce is commissioned to assess incomig immigrants for their skills, so they have a benefit from encouraging more immigration and not favoring locals. You even see this when they write some BS article about needing more people and skills shortages and they get hammered with comments from workers here arguing it is a lie. They even moderate their comments, but you still get most people saying that there is no shortage.

I had better get off my hobby horse now

That's a mighty tall hobby horse and I'll probably quibble about your assessment of why people study at Uni in another post.

Not growing business, trying to get back to where they were before losing two staff to starting families. The owner said that there is still the demand for services to justify another physio, and this would enable her to step back from treating people full time and actually Manage business. Prior to losing the first physio, the owner was only working with clients about 15 hours a week, but now 6 days a week.

I'll ask about prior to pandemic, but I think 4 years ago they were were trying to grow, unsuccessful at attracting new Australian trained physio's even then. The two that left for family reasons had been there when I first attended 12 year's ago.

The migrant physio has only been with them less than a year, so I think plenty of time left on his sponsorship.
But he has been anything but cheap, he is paid appropriately for his qualifications and experience (not a new graduate) as well as the additional expenses involved with bringing him and his family to Australia.

The industry as a whole can't pay much more because they can't charge much more. Like GPs, the Medicare rebate is supposed to be a large percentage of what a consultation costs. But these days Iit barely covers 50% of the consult, I saw lady there the other week walk out without treatment because she wouldn't/couldn't pay the gap on what she expected to be a "free Medicare appointment"

I believe they're also locked in to a set price for DVA and Motor Vehicle injury clients.

Their overheads have ballooned but there is only so much they can do to generate more income when their clientele can't afford heavily discounted services

Yes, I understand that businesses do fold when times are tough. But it concerns me when Health care clinics that are in demand can no longer provide services to the community.

Imagine your frustration if you're referred to a physio for treatment of a shoulder injury but the next available appointment is in 10 days. Not only are you in pain and discomfort for longer, your return to Kiting and Windsurfing is delayed

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D3 said..
That's a mighty tall hobby horse and I'll probably quibble about your assessment of why people study at Uni in another post.

Not growing business, trying to get back to where they were before losing two staff to starting families....
Yes, I understand that businesses do fold when times are tough. But it concerns me when Health care clinics that are in demand can no longer provide services to the community.

Imagine your frustration if you're referred to a physio for treatment of a shoulder injury but the next available appointment is in 10 days. Not only are you in pain and discomfort for longer, your return to Kiting and Windsurfing is delayed

I think we would probably agree that the problem is that the medicare payment has not increased to cover the increased costs everywhere. I worry when this happens as I get scared anytime I see someone try and deconstruct medicare or push to private insurance. It doesn't work well and I would rather the UK system than the USA system anytime.

I have also seen the same with normal GP visits where a local clinic could offer a bulk-billed visit 3 weeks ahead or a paid consultation immediately. I am lucky that I can justify the expense, but I can see where a lot of people couldn't.

Maybe the health care sector is different, but what I have seen with IT is that companies are claiming they cannot get good staff, and then recruit from OS, but want to pay less than a local person. For me, if I were to look at University options all over again I would choose a career that would have stronger stable demand. I would never recommend IT studies to anyone after what I have seen over the years and would push them to something that is less likely to be displaced by OS workers.

Maybe I should retrain as a physio?

No need to up the rebate, just go back to Telehealth. $70 for a thirty second phone consult. Whinge about Covid for a little while, no-one will question if you're taking the piss. Let the good times roll.

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FormulaNova said..

D3 said..
That's a mighty tall hobby horse and I'll probably quibble about your assessment of why people study at Uni in another post.

Not growing business, trying to get back to where they were before losing two staff to starting families....
Yes, I understand that businesses do fold when times are tough. But it concerns me when Health care clinics that are in demand can no longer provide services to the community.

Imagine your frustration if you're referred to a physio for treatment of a shoulder injury but the next available appointment is in 10 days. Not only are you in pain and discomfort for longer, your return to Kiting and Windsurfing is delayed

I think we would probably agree that the problem is that the medicare payment has not increased to cover the increased costs everywhere. I worry when this happens as I get scared anytime I see someone try and deconstruct medicare or push to private insurance. It doesn't work well and I would rather the UK system than the USA system anytime.

I have also seen the same with normal GP visits where a local clinic could offer a bulk-billed visit 3 weeks ahead or a paid consultation immediately. I am lucky that I can justify the expense, but I can see where a lot of people couldn't.

Maybe the health care sector is different, but what I have seen with IT is that companies are claiming they cannot get good staff, and then recruit from OS, but want to pay less than a local person. For me, if I were to look at University options all over again I would choose a career that would have stronger stable demand. I would never recommend IT studies to anyone after what I have seen over the years and would push them to something that is less likely to be displaced by OS workers.

Maybe I should retrain as a physio?

I know it's been a few years since I was physically at a university, but the vast majority of students I interacted with studied courses they were interested.

There were a significant number who did as you suggested, and chose pathways to careers they thought would get them on easy street sooner. However (no actual stats here, just my recollection) those people also made up a significant portion of course transfers after the first semester or two .

I personally chose a degree I thought was aligned with my interests, the subjects I was interested in were the ones I excelled at while the ones I thought tedious were my borderline fails (stats and population studies)

I can't imagine trying to do 3 or 4 year degree (plus honours and poss PHD) in something I'm not invested in apart from I think it will pay well after graduation.

Otherwise I'd have done Law and potentially be on 4 times they money I'm on now.

Interesting, my physio told me ages ago that they initially studied Engineering but swapped after the first year because they didn't like how much math's was involved while they were keen on sports. So they chose physio.


Too me, as a career, physio doesn't seem that attractive. Initially it looks like you can earn decent money and increase it significantly over the first decade, via experience and specialisation. But I think the potential to plateau early combined with the physicality would make it less appealing in middle age and moving to retirement.

Unless of course you could run your own clinic and only work with all the interesting cases

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D3 said..
I can't imagine trying to do 3 or 4 year degree (plus honours and poss PHD) in something I'm not invested in apart from I think it will pay well after graduation.

Reminds me of a school friend that studied medicine because that's what you do if you get the high school marks for it. I ran into him a few years later at UTS and he was studying an artistic design degree there. He told me that he'd completed the first 5 years of the 6 year medicine degree and that as the end of the degree was looming, he became increasingly aware that he didn't want to be a doctor, Kudos to him, I don't think many people could make that decision after putting in 5 years of intensive study and being so close to finishing.

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Harrow said..

D3 said..
I can't imagine trying to do 3 or 4 year degree (plus honours and poss PHD) in something I'm not invested in apart from I think it will pay well after graduation.

Reminds me of a school friend that studied medicine because that's what you do if you get the high school marks for it. I ran into him a few years later at UTS and he was studying an artistic design degree there. He told me that he'd completed the first 5 years of the 6 year medicine degree and that as the end of the degree was looming, he became increasingly aware that he didn't want to be a doctor, Kudos to him, I don't think many people could make that decision after putting in 5 years of intensive study and being so close to finishing.

Is this a common thing now days? I used to work at a university and my colleagues would sometimes comment that all the permanent students dried up once HECS came in. Before that there would be the same faces that would be on campus for a long long time.

I have also spoken to (US) trainee doctors when I have been in south america. I think for them the commitment to become a doctor is so expensive that they cannot imagine changing careers after spending all that money.

I have to say I went into computing when it felt relatively new and there were all these job options on the horizon. It has changed a lot since then and I would be surprised if career advisers don't make students aware of which careers are more promising. It's no use training to become something you love if there are no jobs to continue with.