Newsroom edition: why it feels like a recession even though it’s not
May 30, 2024
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Deputy editor Bridie Jabour and head of news Patrick Keneally discuss the 'vibecession' in Australia, where despite positive economic indicators, households struggle with rising costs. They explore the disconnect between perception and reality, how inflation impacts daily life, and the challenges of addressing economic concerns without harming households.
Consumers are experiencing financial strain despite positive economic indicators, creating a 'vibecession' due to the disconnect between data and real economic experiences.
The media plays a crucial role in bridging the gap between economic data and individual experiences by providing nuanced perspectives and personal narratives.
Deep dives
Economic Discrepancy: Data vs. Perception
Despite positive economic indicators like low unemployment and inflation on track, Australians are feeling financial strain. The term 'vibe session' has emerged to describe this disconnect between data and people's economic experience. Conflicting perceptions arise from significant inflation affecting everyday expenses, particularly for the younger generation and mortgage holders. Different economic sectors and demographics experience the economic impact unequally.
Challenges in Economic Control: Inflation and Interest rates
Examining the complex interplay of economic factors, the Reserve Bank seeks to temper inflation without plunging into recession. Historically, raising interest rates to combat inflation led to severe unemployment. However, current economic conditions pose a challenge as high inflation affects essential items disproportionately, impacting consumer spending and business sectors differently. Policy approaches like strategic government spending and superannuation adjustments are considered amid political and economic uncertainties.
Media Role in Economic Narratives and Realities
The media plays a crucial role in elucidating economic realities and contextualizing figures for the public. By providing nuanced perspectives and personal narratives, the media aims to bridge the gap between economic data and individual experiences. Avoiding sensationalism and offering diverse insights from varying demographic groups contribute to a more comprehensive understanding of the economic landscape.
While the Australian economy has not dipped into recession, consumers are still struggling to afford the essentials. This widening gap between a slightly improving economy and households continuing to feel the pinch of the cost-of-living crisis has been called a ‘vibecession’.Bridie Jabour speaks with deputy editor Patrick Keneally and head of news Mike Ticher about how the economy is making Australians feel and why that may say more than the numbers
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