WE MIGHT all be crying poor but new statistics indicate otherwise.
According to the latest AMP NATSEM Income and Wealth Report, Australian household income is outpacing the cost of living over the longer term, with disposable incomes increasing 20% over the last 27 years, while the average family is better off by $224 per week in real terms.
The AMP NATSEM Income and Wealth Report explored how living costs have changed since 1984 and found that average income growth for Australian households across all income and socio-economic groups more than covered the cost of living over this period.
However, cost of living pressures continued with strong price growth since 1984 across everyday essentials including electricity, which increased 253%, rent (up 223%), mortgages ( up 256%), petrol (up 208%) and public transport costs (up 287%).
This growth was partially offset by dramatic drops in audio visual and computing, which now cost
one tenth what they did in 1984, while average prices for clothing, footwear and major household
appliances have changed little, and are often lower today than 27 years ago.
Among the reports key findings were that:
- We're spending more on discretionary items
Overall households are spending a greater proportion of income on services such as private
schooling, restaurant meals, childcare and tertiary education.
- Incomes have outpaced the cost of living across the board since 1984
Couples with children have seen their income grow by 37%, single parent incomes have
grown 34% and working families 22%.
- The cost of services have increased strongly since the 1980s
Education expenses for secondary students have grown by 264%, or 4.9% per annum,
mostly attributed to higher private school fees. Medical, dental and insurance costs have
increased at even greater rates, jumping 560%, 356% and 346% respectively.
- The costs of many imported goods shrank since the 1980s
The lower or stagnant prices of clothes and footwear, computing and audio visual equipment
have all helped to offset price increases in other areas.
- Work demands have driven increases in childcare spending
- Australia's petrol prices are among the lowest in the world
Only Canada, USA and Mexico have cheaper petrol prices in the developed world.