The other night I woke up, as I usually do after falling asleep on the couch with my dinner half eaten still on my lap, to the sounds of the ABC News “The Business” show on the TV.
(No, I don’t live alone with my cats. I have dogs.)
As is usually the case, my first thought was to wish I’d studied commerce or business or something other than politics so I could understand what they were saying. But then they said something that I understood.
“We’re already in a per capita recession, if it wasn’t for immigration we would be in a recession.”
And my political brain thought: why is the Liberal Party not screaming this from the top of every rooftop?
How is it possible that an economist of Angus Taylor’s calibre – a Rhodes Scholar, former shadow treasurer, a man described by his own colleagues as “the smartest policy brain in the shadow cabinet” – not talking about this and nothing else?
Not values and culture wars and failing to answer questions about monoculture – THIS! Australia would be in a recession if not for immigration! Australians have been getting poorer, per head, for almost two years straight, and he doesn’t think that is the headline? Seriously?
It’s the economy, stupid.
Let’s translate the jargon for those of us who, like me, probably should have paid more attention in economics class.
Australia’s GDP – the total value of everything we produce – has been growing. Just enough to avoid the technical definition of recession, which requires two consecutive quarters of negative growth.
But when you divide that number by the number of people in the country, something very different emerges. GDP per capita – what each of us, on average, is contributing to and benefiting from – has been falling. For the longest run on record since the ABS began keeping seasonally adjusted figures in 1973.
The per capita recession showed its first tentative signs of easing at the end of 2024 – a 0.1 percent uptick, barely enough to count – before slipping back into negative territory in the March 2025 quarter.
The only thing keeping the headline number out of the red has been population growth. Specifically, immigration. When you add hundreds of thousands of people to an economy each year, the aggregate number goes up. But the slice each of us gets? That’s been shrinking.
Real household disposable incomes fell around eight percent from their mid-2022 peak. OECD data confirmed Australia recorded the largest decline in real per capita household income of any developed economy – worse than the UK, worse than the US, worse than basically everywhere.
And yet somehow, this is not the opening line of every speech Angus Taylor gives. Nor is it every question in Question Time. Stupid.
Most economists will tell you that immigration is not the cause of Australia’s economic weakness. The Grattan Institute’s position is that the per capita problem predates the post-COVID migration surge, and that what Australia really needs is productivity reform. The structural problems – weak business investment, a housing market that has failed to keep pace with demand for decades, and an over-reliance on our great resources sector – those were there long before the arrival queues got long.
Immigration, in other words, has been doing us a favour. It’s the only thing propping the headline number up while the underlying economy underperforms. That is actually a more damning indictment of our economic management, not a less damning one.
It means successive governments have been using population growth as a substitute for economic policy. Keep adding people, keep the aggregate number growing, and you can stand at a podium and say the economy is resilient. Meanwhile, the family who can’t afford their mortgage, the graduate working two jobs and still renting from their parents – they’re experiencing a recession that just doesn’t have the official name.
And this makes all of Hanson’s anti-immigration nonsense and the various attempts to out One Nation One Nation look even more stupid.
Which brings me back to Angus Taylor. Stupid.
Taylor knows all of this. He has written about commodity cycles and productivity and freight reform. He understands the numbers and all that money stuff that my brain does not. So when he stands up and makes immigration about values and cultural risk rather than about the per capita GDP data sitting right in front of him, it isn’t an oversight. It’s a choice. And it’s stupid.
The window between where we are now and a conventional, technical recession is not large.
When that happens, Australians will want to know who saw it coming and said so clearly, and who was busy talking about something else.
It’s the economy, stupid. Always has been.
End rant.
Dr RK (Kath) Crosby is the CEO of research and strategy company KORE CSR, former strategist for the Australian Democrats, and holds a PhD in political behaviour. She is also a well known migraine and health advocate, and the Publisher of New England Times and North Coast Times.
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