Weak economic conditions in the past couple of years have seen
growth in labour costs slow to 2 1/2 per cent over the year to the December quarter, from 3 1/2 per cent a year earlier.
In turn, slower
growth in labour costs is having a beneficial effect on international competitiveness.
The slowing in wage growth across all industries has meant that firms have experienced relatively slow
growth in their labour costs.
Some pick - up in inflation is likely in 1998 as the favourable exchange rate effects pass but, provided
growth in labour costs is not excessive, price inflation should remain within the 2 to 3 per cent range.
On the one hand, the ongoing evidence of tightness in the labour market suggests that
growth in labour costs may pick up faster than is assumed in the current forecast.
Furthermore, the NAB quarterly business survey reported that year - ended
growth in labour costs was essentially unchanged in March, and is expected to remain roughly constant in the June quarter.
Not exact matches
Long - term interest rates are currently low due to low global inflation expectations and moderate
growth potential
in Canada due to lower oil prices, a heavily indebted household sector and a weakened manufacturing base due to relatively high unit
labour costs.
Growth in the all - important US services sector slowed for a third straight month
in April, according to a closely watched survey, as optimism over the state of the American economy is tempered by concerns over
labour shortage and rising input
costs.
Looking forward, the survey also suggests that businesses expect a modest pick - up
in growth of
labour costs in the September quarter.
The September quarter NAB survey finds that
labour cost growth picked up to 0.7 per cent
in the September quarter, although respondents expect it to return to around 0.5 per cent
in the December quarter.
Low overall inflation has, to a large extent, been a result of relatively subdued
growth in unit
labour costs.
The NAB survey indicates that the
growth of
labour costs has picked up over the year to June, though the rate of
growth in this series is still quite low.
Outgoing Coles managing director John Durkan, who is set to hand the reins to Steven Cain before the demerger, still expects the retailer to return to profit
growth in the June half despite a «small headwind» from higher
labour costs.
Strong
growth in productivity may continue to restrain
growth in unit
labour costs to a greater extent than expected, though productivity
growth in the past year has been below that
in the preceding few years.
Strong productivity
growth, combined with moderating wage
growth and ample spare capacity
in the economy, led to unit
labour costs falling by 1.7 per cent over the year to the December quarter.
In addition, labour market conditions have tightened over recent months, as seen in the above - trend growth in employment in the December quarter, the fall in the unemployment rate and reports of labour shortages and pressure on non-wage cost
In addition,
labour market conditions have tightened over recent months, as seen
in the above - trend growth in employment in the December quarter, the fall in the unemployment rate and reports of labour shortages and pressure on non-wage cost
in the above - trend
growth in employment in the December quarter, the fall in the unemployment rate and reports of labour shortages and pressure on non-wage cost
in employment
in the December quarter, the fall in the unemployment rate and reports of labour shortages and pressure on non-wage cost
in the December quarter, the fall
in the unemployment rate and reports of labour shortages and pressure on non-wage cost
in the unemployment rate and reports of
labour shortages and pressure on non-wage
costs.
[4] Non-tradable inflation was elevated during the boom years and
growth in nominal unit
labour costs was relatively strong for most of this period.
While «outsourcing» for low -
cost labour may have motivated outward investment
in the last decade, the new driver of investment is clearly domestic economic
growth in Asia.
Most
labour cost indicators continued to signal solid wages
growth in the March quarter.
Most
labour cost indicators suggest that wages
growth edged up
in the second half of 2003, consistent with signs that
labour - market conditions remain firm.
On its own, however, faster economic
growth will not do enough to reduce unemployment significantly, unless it is accompanied by moderation
in growth of
labour costs.
The international comparisons shown here suggest, however, that
growth in unit
labour costs in Australia has still been on the high side over the past couple of years, given the rate of unemployment.
Core inflation has drifted higher over the past year, as slowing productivity
growth has pushed up
growth in unit
labour costs, albeit from a very low level.
The profits recovery has been driven by continued strong productivity
growth in conjunction with subdued compensation
growth (due to the weak
labour market), which has seen unit
labour costs fall by 5 per cent since June 2001 — the largest fall on record (Graph A4).
Unit
labour costs (based on compensation per hour worked) grew by 1.3 per cent
in the June quarter to be 2.8 per cent higher over the year, which is around the average
growth rate of the past few years.
Their
growth was accelerated by a rapid increase
in exports to industrialised countries with whom they successfully competed thanks to low
labour costs.
Similarly, I've argued that
Labour should focus on
growth as well as the
cost of living;
in other words, making the economic pie bigger,
in addition to sharing it more equitably; being a party of increased production, not simply fairer distribution.
As for VOF itself, it trades on a 0.81 Price / Book multiple, despite an aggressive & ongoing share buyback programme — I see plenty of gains ahead
in terms of NAV
growth & discount compression, as Vietnam continues to leverage & benefit from its
labour /
cost export advantage, and (just as importantly) its burgeoning domestic consumer economy.
When considering changes to
labour and employment standards legislation, BC policy - makers need to be mindful of the
cost impact on employers, pay attention to developments
in other jurisdictions, and avoid taking actions that could jeopardize the strong economic
growth and robust job creation the province has enjoyed
in recent years.
While surviving the declined
labour productivity
in the last two quarters, the first quarter statistics revealed a modest but hopeful increase by 0.3 % for Canadian businesses, with a decrease
in costs by 1.8 %, attributed
in some way to the slight, but slowed
growth in hourly compensation.
It is anticipated that a continuing tight
labour market, robust income
growth and high levels of consumer confidence will help to offset the dampening effect of rising mortgage carrying
costs on the demand for new and existing homes
in B.C. Housing starts should decline from 39,195 units
in 2007 to 33,250
in 2008 and 31,700
in 2009.