Australia faces its slowest income growth in more than 50 years, financial services company Deloitte has warned.
In a report released on Monday, the company predicted national incomes would rise by 1.2 per cent in 2016, the slowest rate of growth since the statistic was first collected in 1960.
“Weak incomes today are a risk to growth down the track,” the report said, according to The Australian.
Inflation was 1.5 per cent in 2015, the Reserve Bank reported last year. If prices increase similarly in 2016, the average Australian wage would be worth less by year’s end.
The Deloitte forecast came as economic rumblings in China continued to hit global share markets, commodity prices and currency exchange rates.
The report warned of potential further ramifications from China’s “woes”.
On Monday, the Aussie dollar fell to a seven-year low of 68.43 US cents, as oil prices sank below US$30 per barrel.
The US stock exchange fell sharply, with the S&P 500 sinking to its lowest since October 2014, signalling a potential bad day for Australian stocks.
US industrial production and retail sales dropped in December, it was reported this week, with some analysts attributing this in part to China’s downturn.
Despite the global volatility, the Australian Treasurer insisted the nation’s economy was “very sound” and that the federal government’s economic plan was “exactly as we need it to be”.
“We are not earning enough as a country and that obviously has an impact on revenues,” Mr Morrison told Sky News on Monday.
“But the fundamentals of the Australian domestic economy, I think, are very sound.”