Management Blog

Australian competitiveness gets noticed

Australia has rated well in a study of the world's most competitive countries, Smart Company reports.

The World Competitiveness Yearbook, which is compiled by international business school IMD, ranked Australian seventh in its competitiveness table.

The position is an improvement on last year's listing which ranked Australia as the world's 12th most competitive country.

In addition to competitiveness, the nation was recognised for its resilience to economic cycles, political stability, education standards and awareness of socio-economic reform requirements.

Tourism still going strong

New statistics indicate the Australian tourism industry is enjoying its strongest growth in almost a decade, The Age reports.

Australian Bureau of Statistics data shows the industry is now worth $85 billion to the economy, an increase in 7.8 per cent on 2005-2006 figures.

Domestic consumption increased by 6.8 per cent while international tourism grew by 9.8 per cent over the period.

Despite the encouraging figures tourism experts say the industry must continue to innovate in order to remain strong during difficult international economic conditions.

Hard times leading to unpaid bills

Small businesses that provide household services are having trouble receiving payments from an increasing number of cash strapped clients, The Daily Telegraph reports.

According to the article, the bills of plumbers, electricians, accountants, architects, builders and mechanics are being left unpaid for longer due to rising interest rates.

Debt collection agency Prushka says businesses are being forced to use tough debt collection tactics including adopting an 'almost relentless attitude' to overdue payments.

Prushka says many small businesses used to be relatively lenient with regard to their payment terms but have tightened up as a result of the growing non-payment trend.

Jobs growth continues unabated

Many Australian workers liked what they saw on their pay slip in January this year with the country recording an average 4.7 per cent increase in wages growth, AAP reports.

Research by consulting and outsourcing company Mercer identified a 0.2 per cent increase on last year’s figures, the highest growth in three years.

Mercer says that while there is pressure on companies to curb wages growth in the interests of keeping inflation at bay, many employers are forced into raising wages to hold onto staff.

The highest pay gains were recorded in the construction and energy sector. Conversely, engineering, sales and clerical roles all experienced wages growth that was less than the national average.

Economic slowdown could foster fraud: KPMG

If the Australian economy experiences a downturn we can expect to see more incidents of workplace fraud, accounting giant KPMG warns.

KPMG's head of financial services, Andries Terblanche, says fraud is destined to become a more common problem for businesses as a result of rising interest rates and an increase in the cost of living.

While banks and other financial institutions are most at risk, KPMG says the issue of fraud has a potential to affect all areas of business during an economic down-cycle, the ABC reports.

Good and bad news for retail

Economists predict consumer spending will grow by approximately 4% in the first half of 2008 before experiencing a decline as the year continues, Smart Company reports.

Electronics – including digital cameras and flat screen TVs – overseas travel, fashion and male grooming products are all predicted to sell strongly in the first half of the year.

Categories that have been identified as facing the prospect of slowing sales are home furnishing, gardening products as well as newspapers, books and magazines.

Analysts say the second half of 2008 will see an overall decline in retail spending as a result of growing concerns about household debt.

Economy strong heading into '07

The Westpac-Melbourne Institute index of economic activity indicates the Australian economy strengthened by 1.2 points (0.5 per cent) during October, The Age reports.

This increase takes the economy's annual growth rate to 5.5 per cent; a movement economists say indicates a long term trend of 4.2 per cent growth over the next three to nine months.

Westpac says that due to its impact on inflation, continued growth will put pressure on the Reserve Bank to increase interest rates this year, possibly as soon as early February.

Wages on the rise

Australians are taking home larger pays than this time last year according to new Australian Bureau of Statistics figures that show a 4.2 per cent increase in wages over the year to September.

Citigroup economists say the increase is not a cause for concern with regard to interest rates as wages would need to rise by more than 4.5 per cent for the RBA to take immediate action.

The HSBC is also positive about the news saying the figures prove wage pressures are under control even though the economy is booming and the labour market is tight.

Strong dollar good for Xmas trade

The Australian Retailers Association says the strengthening Australian dollar should result in lower prices for shoppers in the lead up to Christmas, news.com.au reports.

Australian Bureau of Statistics data reveals the cost of imported goods are currently at their lowest level in 15 years with imports dropping 5 per cent since June this year alone.

Commentators say the high Aussie dollar may soon see a record number of consumers bypassing local retailers and going online to purchase cheaper items directly from the US.

Manufacturing boom continues

The nation's manufacturing activity increased in July as a result of strong consumer spending, high employment rates and a healthy construction industry, The Australian reports.

The Performance of Manufacturing Index (PMI) – which is recorded by the Australian Industry Group and PricewaterhouseCoopers Australian – increased 4.3 points in July to 57.4 points.

All states enjoyed an expansion in manufacturing production with Queensland, Western Australian and Tasmania reporting the strongest growth over the last month.

Experts say food and beverages, clothing and footwear, construction materials, chemicals, petroleum and coal sectors all look set for continued growth.