Age/SMH Senior Economics Correspondent Shane Wright has written a great summary of the business indicators data released yesterday by the ABS: An economy like 2016 as sales and wages collapse. The business indicators data are pieces of the jigsaw puzzle that is the National Accounts, which reports the nation’s GDP and its components. The June quarter National Accounts will be published by the ABS tomorrow. Perversely, company profits were up 15% in June quarter, largely due to JobKeeper and other subsidies, but income from sales and wages collapsed, as expected, in June quarter, according to the business indicators data (see chart below).

Queensland experienced the largest drop in total wages paid, although that’s not what we would have expected based on the single touch payroll data published by the ABS. It’s possible sampling error has led to Queensland having the worst result across Australia. In any case, the economic hit has been massive.

Overall, it’s expected that the Australian economy contracted by around 7% in June quarter, over three times the previous record for a quarterly contraction recorded in the mid-seventies. And, because of the Victorian outbreak, we shouldn’t expect a rebound in the September quarter we’re currently in. Check out this post from my colleague at Adept Economics Taylor-Rose Hull:

How bad was the second quarter GDP contraction?

Unfortunately, we will likely be in the economic crisis for many months yet. I told Scott Emerson on 4BC yesterday afternoon that I’m very worried about the economic outlook, with the looming fiscal cliff, default cliff, and insolvency tsunami that will eventuate from the end of September.