Australia’s gross domestic product (GDP) increased by 0.3% in the September quarter of 2024 and by 0.8% over the year to September 2023, according to figures from the Australian Bureau of Statistics (ABS).
Katherine Keenan, ABS Head of National Accounts, noted, “The Australian economy grew for the twelfth quarter in a row, but has continued to slow since September 2023.”
Growth in the quarter was primarily fuelled by public sector expenditure. Government consumption and public investment made significant contributions, with public investment rising 6.3%, driven by defence equipment imports and investments in infrastructure such as hospitals, roads, and renewable energy projects.
“The rise in public investment in the September quarter followed three consecutive quarterly falls. The level of investment this quarter was the largest on record, the previous record was in September 2023,” said Ms Keenan.
Government spending increased by 1.4%, supported by social benefits like energy cost relief rebates under the Energy Bill Relief Fund.
Household spending was unchanged in the September quarter, following a 0.3% decline in June. Electricity and gas spending dropped due to energy rebates, shifting expenditure from households to the government in national accounts.
“The rebate-driven fall in household electricity spending was offset by growth in other categories. Clothing and footwear rose in response to unseasonably warm weather and essential spending grew moderately with continued growth in rent, health, and education services,” Ms Keenan said.
Spending by Australian travellers abroad boosted tourism-related sectors, including hotels, cafes, and cultural activities.
Net trade contributed 0.1 percentage points to GDP growth, as exports increased by 0.2% and imports decreased by 0.3%.
Goods exports, particularly coal, rose by 0.9%, while goods imports, including motor vehicles, fell by 1.5%.
However, a $712 million decline in inventories detracted 0.4 percentage points from GDP growth. Education-related travel exports dropped, while services imports rose 3.0% due to Australians travelling abroad, particularly to Europe.
The terms of trade fell for the third consecutive quarter, declining 2.5% as export prices dropped by 2.6%, reflecting weaker global demand for bulk commodities. Import prices also decreased, driven by lower fuel and lubricant costs.
The household saving ratio rose to 3.2%, supported by a 1.5% rise in gross disposable income, which outpaced nominal household spending growth of 0.6%.
“The introduction of stage 3 tax cuts saw a fall in the amount of income tax paid by households of 3.8 per cent in the September quarter. This contributed to a rise in household gross disposable income,” Ms Keenan said.
In a separate data release, Australia's Tourism Satellite Account, which estimates tourism's direct contribution to GDP, added $78.1 billion in 2023-24, a rise of 5.5% in chain volume terms, and accounted for 2.9% of the economy.
International tourism consumption surged by $10.8 billion, while domestic consumption fell by $2.3 billion in chain volume terms.
Tourism gross value added reached $65.9 billion, the highest on record, with significant growth in education and training, passenger transport, and dwelling ownership.
Tourism employment rose 5.7% to 691,500 filled jobs, driven by gains in education, food services, and sports and recreation.
Domestic tourism consumption in current prices increased 1.7% to $160.2 billion, while international consumption soared 47.7% to $38.3 billion, reflecting a strong rebound in global travel demand.