Month End Wrap - July 2023

The Economic Seesaw: Balancing Growth and Challenges in Australia

As we conclude the first month of the new financial year, I find myself reflecting on the conversations I've had with my CEO and HRD network over the past month. The sentiment is one of cautious optimism, a sense of resilience tempered by the reality of the challenges that lie ahead. The economic landscape is a complex tapestry, woven with threads of GDP growth, inflation, unemployment, and exchange rates. It's a picture that is constantly evolving, shaped by global events and local decisions.

The Q2 2023 Economic Outlook report by KPMG Australia provides some valuable insights that echo the sentiments I've heard. It's like a mirror, reflecting the hopes and concerns of our business leaders. But it's also a map, guiding us through the economic terrain of the next six months.

The GDP growth rate, the heartbeat of our economy, is expected to slow down slightly.

It's like a runner who has sprinted out of the blocks, only to realise that the race is longer than they thought. The initial burst of energy, fuelled by pent-up demand and government stimulus, is giving way to a more sustainable pace. But let's not forget, a slower pace doesn't mean we're not moving forward. It's a marathon, not a sprint, and we're in it for the long haul.

Inflation, that pesky bugbear, is projected to ease. It's like a balloon that's been inflated too quickly, straining at the seams. The pressure is starting to ease, but the balloon is still larger than it was. The challenge for businesses is to manage this inflationary pressure without letting the air out of their growth and profitability.

Unemployment, the barometer of our labour market, is expected to rise slightly.

It's a reminder that our most valuable asset is our people. At Harrier, we firmly believe that the future of Australia is driven by the talent of today. That’s our purpose. The slight uptick in unemployment underscores the importance of talent management in driving our economic recovery. It's a call to action for businesses to invest in their people, nurture their talent and unlock their potential.

The AUD/USD exchange rate, the seesaw of international trade, is expected to rise. It's a boon for businesses that rely on imports, but it's also a reminder of our interconnectedness with the global economy. We're not an island, economically speaking. The ripples of global events wash up on our shores, shaping our economic landscape.

I’ve also heard in the past month varying degrees of optimism and concern from different sectors; from education and healthcare to arts and other services. Each sector is like a piece of the economic puzzle, unique in its shape and size, but essential to the overall picture. The challenges and opportunities in these sectors are as diverse as the sectors themselves. It's a reminder that our economic recovery will be a team effort, requiring the collaboration of all sectors.

In the face of these challenges and opportunities, the sentiment among my CEO and HRD network is one of resilience.

There's a sense of determination, a willingness to roll up our sleeves and get to work. There's a recognition that the road ahead may be bumpy, but there's also a belief that we have what it takes to navigate it.

The conversations I've had have been a source of inspiration. They've reinforced my belief in the power of collaboration, in the strength of our collective wisdom. They've reminded me that while the economic outlook may be uncertain, our resolve is not.

Let's remember that we're not just observers of the economic landscape, we're also shapers of it. Our decisions, our actions, and our resilience will help shape the economic outlook for the next six months and beyond.

So, here's to the next few months, filled with challenges to overcome, opportunities to seize, and growth to achieve. Here's to the power of collaboration, the strength of our collective wisdom, and the resilience of all our people. Here's to the talent of today, driving the future of Australia.

(Note: The figures referenced are from the KPMG Australia Economic Outlook Q2 2023 report. They are projections and should be treated as such. Actual results may vary.)