Australia’s consistently high rating for its standard of living – on one survey at least, it’s the best country in the world that you can live in – could be under threat by the shifts in the economy.
Reserve Bank of Australian Deputy Governor Phillip Lowe has been speaking at a conference this morning on productivity and infrastructure, and warned Australians might have to get used to a lower standard of living.
Basically, as a country we have enjoyed a period of strong growth off the back of commodity prices, which have fuelled decades of economic expansion. And it could be about to change.
Here’s some of what he said:
“While we can’t be sure, it is more likely that the terms of trade will decline from here rather than increase further from what is a very high level by historical standards.
“And in terms of Australia’s demographics, the sweet spot is now behind us.
“We can no longer depend on a rising terms of trade and favourable demographics to make us richer.”
Australia topped this year’s OECD Better Life Index, which examines the standard of living in its 34 member countries.
The OECD, a club of rich nations, said Australia came out on top when 11 factors, including income, housing and education, were weighed up.
In second place was Sweden, followed by Canada.
Australia took the top spot, for the second year in a row, with an average life expectancy of 82 — which is two years higher than the OECD average.
Overall, the country ranks extremely highly in in health, civic engagement, and housing.