Australia and Canada closely resemble each other. Then why have the Aussies done so much better than us?
Here’s a country buffeted by the Chinese economic slowdown, overly reliant on resource extraction and hostage to plummeting commodities prices. Welcome to Australia, land of milk and honey, at least compared with Canada, the OECD country that most closely resembles it. Despite the liabilities above, which the Aussies share with Canada, Australia is on course this year to eclipse the Netherlands’ record of an unbroken 26 years of GDP growth.
Australia’s jobless rate is 5.7 per cent. Canada’s is 7.0 per cent. Average annual wages in Australia in 2015 were $64,680, to Canada’s $61,684. (All figures in Canadian dollars.)
Low-paid workers make up a smaller share of total employment in Australia than Canada, at 18.9 per cent and 21.8 per cent, respectively. The yawning gap in pay between men and women in Canada is 19.5 per cent. Australian women, by contrast, are paid just 13.8 less than men for work of the same value. (Mind you, the gold standard is New Zealand’s 5.9 per cent.)
By mature-economy standards, Australia has been booming, with annual GDP growth of 3.1 per cent for the fiscal year ending June 1, outperforming the U.S. and the European Union (EU). By contrast, Canada’s GDP growth over the first half of 2016 has been a pitiful increase of 0.8 per cent.
Australia and Canada each got through the Great Recession relatively unscathed, buoyed by continued resource exports to a still-booming China. But since the Chinese economic slowdown, Canada’s GDP growth has flat-lined, while Australian GDP growth is still robust. Is Australia a model for future Canadian prosperity?
For the rest of this article, click here: https://www.thestar.com/business/2016/09/09/how-the-land-down-under-ended-up-on-top-of-the-world-olive.html