Prime Minister Scott Morrison has played down concerns about the state of the Australian economy, but business believes slowing economic growth should be a wake-up call.
The economy grew by 0.2 per cent in seasonally adjusted terms in the three months to December and by 2.3 per cent in the year to December.
The figures, released by the Australian Bureau of Statistics on Wednesday, failed to meet the expectations of economists and the central bank.
Gross domestic product per capita – which adjusts for population growth to gauge changes in a country’s living standards – also fell by 0.2 per cent, on the back of a 0.1 per cent fall in the September quarter.
The two consecutive quarterly dips represent a recession on that measurement, only the third of its type in the past 27 years.
But Mr Morrison says only Labor – which called the GDP per capita recession a “damning indictment” of the coalition’s economic stewardship – is interested in that metric.
“The real indicators of living standards go to the national income per capita and these have been rising, as you know, over the past year and I welcome that,” he told reporters in Perth on Thursday.
“I’m not going to engage in the made-up statistics that the Labor Party are talking about.”
Mr Morrison reiterated Australia was facing global headwinds to growth, making it even more important for the government to stick with its economic plan including lowering taxes and investing in infrastructure.
Business Council of Australia chief executive Jennifer Westacott is more alarmed about the latest national accounts.
“These numbers, two consecutive quarters of slower growth, these are wake up calls for everybody,” she told ABC radio on Thursday.
“We have to now find a way of making sure that doesn’t get any worse.”
She agreed with the prime minister’s sentiment that investment would help turn things around.
“We’ve got to double down on investment. That is the crucial thing here.”
Mr Morrison and Labor leader Bill Shorten are also both trying to convince Australians they would be better placed to boost their pay packets.
That comes after Mr Shorten told a business event in Sydney on Wednesday the next election would be a “referendum on wages”.
Labor wants to restore penalty rates, review the wages of feminised industries typically paid less, and clamp down on wage theft.
Mr Shorten also wants the minimum wage to be higher and believes the enterprise bargaining system should be overhauled.
The prime minister argues Labor won’t be able to improve wages while taxing Australians more, and that the 2.3 per cent wage growth in the 12 months to December is still beating most developed nations.
“Wages growth will come with economic growth,” he said.