News National Hockey can’t turn economy on a dime

Hockey can’t turn economy on a dime

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· Toyota, Hockey clash

Federal Treasurer Joe Hockey says it is impossible to turn the economy around quickly while the opposition blocks key elements of its recovery plan.

During parliamentary question time on Wednesday, shadow treasurer Chris Bowen asked Mr Hockey when he was going to take responsibility for declining employment.

He said more jobs have been lost since the government came to power last September than in the whole of 2009 during the global financial crisis.

“We are unable to turn the economy around on a two-bob piece,” the treasurer replied.

“We actually have to get through our legislative program which actually helps to build a stronger economy.”

He said the best thing Labor can do is help the government repeal the carbon and mining taxes and help it repair the budget and pay down government debt.

“That’s going to create the jobs,” he said.

New data suggests consumers are becoming increasingly worried about job security and the risk of a tough budget.

The Westpac-Melbourne Institute consumer sentiment index dropped for a third straight month in February, falling three per cent to be 7.5 per cent down from a year ago.

It now stands at its lowest level since July 2013.

“We suspect the run of bad news around the motor vehicle industry, other manufacturers and Qantas may have rattled consumers,” Westpac chief economist Bill Evans said.

“Households seem to be sending a fairly clear message … questioning why fiscal policy is about to be tightened and interest rates lifted when the labour market is so weak.”

Mr Bowen said Mr Hockey used to tell people that consumer confidence would “magically rise” just by his election to treasurer.

“The reality is very much different,” he told reporters in Canberra.

Macquarie Research economist Gabby Hajj said the consumer confidence report contrasts with the improvement in business conditions over the last two months.

“(It) casts a shadow over the longevity of the recent run-up in retail trade activity,” he said.

Official labour force data for January on Thursday are unlikely to lift the spirits of consumers with economists expecting the jobless rate to rise to 5.9 per cent, having stood at 5.8 per cent over the past three months.

It would be the highest unemployment rate since June 2009.

While economists expect the number of people in employment to have risen by 15,000 in January, after the surprise 22,600 drop in December, it won’t be enough to prevent the jobless rate rising.

The government’s leading employment index released on Wednesday fell for a fourth straight month in February, although it is too early to expect sub-trend employment growth to continue in coming months.

The leading jobs indicator anticipates movements in the growth cycle of employment, with a turning point confirmed after six consecutive monthly moves in the same direction.

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