5206.0 - Australian National Accounts: National Income, Expenditure and Product, Sep 2016 Quality Declaration 
Latest ISSUE Released at 11:30 AM (CANBERRA TIME) 07/12/2016   
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MEDIA RELEASE
7 December 2016
Embargoed: 11:30 am (Canberra time)
134/2016
Economy declines 0.5 per cent in September quarter

The volume of activity in the Australian economy decreased 0.5 per cent in the September quarter 2016, the first quarter of negative growth since the Queensland flood affected March quarter 2011. Through the year growth remains positive at 1.8 per cent, reflecting the three previous quarters of growth.

Economic activity contracted in a number of areas this quarter. Private investment in new buildings detracted 0.3 percentage points from GDP growth, while new engineering and new and used dwellings detracted 0.2 and 0.1 percentage points respectively. Public capital expenditure detracted 0.5 percentage points from growth as it declined from elevated levels in the June quarter. Net exports detracted an additional 0.2 percentage points from growth. Australia’s terms of trade rose 4.5 per cent through the September quarter.

The reduced building activity is reflected in the output of the construction industry which fell 3.6 per cent for the quarter and was the largest contributor to the fall in GDP growth on an industry basis. A number of other industries also recorded below trend growth, or declined, this quarter, including financial and insurance services, professional scientific and technical services, rental hiring and real estate services and administrative support services. The largest offset to these falls was agriculture which grew 7.5 per cent. Mining production contributed no growth, but maintained its historically high levels of production.

Subdued activity in the building industry contributed to a decline in the income of small businesses, with gross mixed income down 5.8 per cent. Private non-financial corporation’s gross operating surplus increased 1.2 per cent, supported by stronger mining commodity prices. Compensation of employees increased 1.3 per cent, and real gross national income increased 0.9 per cent for the quarter to be 3.2 per cent higher through the year.

Further details can be found in Australian National Accounts: National Income, Expenditure and Product (cat no. 5206.0), available for download from the ABS website: http://www.abs.gov.au.

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