Colin Brinsden, AAP Economics Correspondent
(Australian Associated Press)
Low-income growth is not something new that has just crept up on the economy and explains why Australian households may be struggling to make ends meet.
But new figures released by the Australian Bureau of Statistics show inequality is only marginally higher.
“When you look at it on a global scale, Australia is still low,” ABS chief economist Bruce Hockman told AAP on Wednesday.
In its two-yearly survey of income and housing, average household debt has almost doubled since the early 2000s, with about three in 10 Australian households considered to be “over-indebted”.
A separate ABS report also shows that while energy costs are at the centre of a heated political debate, education has seen the biggest increase in household spending since the start of the decade.
The ABS found that while the average weekly household income grew by $274 to $982 in the four years between 2003/04 and 2007/08, it grew by only $27 to $1009 in inflation-adjusted terms during the next eight years.
However, average household wealth increased 11 per cent between 2013/14 and 2015/16 to $929,400, largely as a result of rising property values.
At the same time, average household debt rose to $169,000 in 2015/16, up from $94,000 in 2003/04.
One in four households carried debt equal to three or more years’ worth of disposable income and a further two per cent held debt equal to three-quarters of the value of their household assets.
“Based on either of these comparisons, around three in 10 households with a debt in Australia are considered to be ‘over-indebted’,” Mr Hockman said.
Using the so-called Gini coefficient – an international measure of inequality – income inequality rated 0.323 in 2015/16 but within a range of 0.320 and 0.333 that has stood since 2007/08.
Values closer to zero represent higher equality while closer to one represent higher inequality.
Wealth is less equally distributed than income among Australians, scoring 0.605 in 2015/16, the same as two years ago but higher than the 0.573 recorded when it was first measured in 2003/04.
The bureau’s separate six-yearly household expenditure survey found between 2009/10 and 2015/16 spending on education jumped 44 per cent followed by household services and operations such as cleaning products and pest control, which increased by 30 per cent.
Energy and healthcare were joint third, rising 26 per cent, while at the other end of the scale, spending on alcohol, tobacco, clothing and footwear, and household furnishings showed no significant change.