MELBOURNE, Australia — For nearly 30 years, Australia seemed to be able to weather the dot-com crisis and the global financial crisis without a recession, while its citizens mostly enjoyed high salaries, affordable housing and favorable prospects.
When a recession did come, in 2020, it was due to the Covid-19 pandemic.
But four years later, Australia has been unable to shake off some of the headwinds, including a high cost of living — the price of bread has risen 24 percent since 2021 — a choppy labor market and rising inequality. While these and similar problems also plague nations such as Britain and the United States, they are particularly painful for many in Australia, which has long considered itself the “lucky country.”
Australia is among the wealthiest, most resource-rich and stable countries in the world. But millions of residents are experiencing levels of hardship not seen in many decades. They say they are struggling to put food on the table, pay for housing and health care, and cover their utility bills. And many young Australians are facing a reality their elders never had to face: that they will be worse off than their parents or grandparents.
Australians are paying more for almost everything. The pandemic brought with it skyrocketing inflation, which has since slowed, although 3.4 percent is still relatively high. Rents in some Melbourne neighborhoods have risen almost 50 per cent in a year, and rental affordability is at its lowest level in at least 17 years. Consumer confidence has barely changed since it fell in 2020.
Homeowners are also under pressure. Australian mortgages are generally fixed for a few years and while the central bank has tried to control prices by raising interest rates, they have tripled to 6.7 per cent in recent years.
“Things are much worse than before the pandemic and there is little inspiration for us to be optimistic,” said Nikki Hutley, an independent economist in Sydney.
A survey last year by think tank Per Capita found that fewer than one in four Australians who didn't own a home expected to be able to own one. Australian renters have fewer protections than in most other wealthy countries. Renters have relatively few limitations on how much they can raise rent; tenants face regular “inspections” of their homes; and the Government offers large tax concessions to renters.
The shortage of rental housing has also caused rents to skyrocket in some neighborhoods, pushing young people further and further away from cities. In Sydney, the exodus of young families, a recent report warned, risks creating a “City Without Grandchildren”.
Despite the country's abundance and its oft-stated love of egalitarian values, Australia's wealth is increasingly unequally distributed, as the nation joins the ranks of others facing growing inequality and economic tensions. and generational.
Economic unhappiness has resulted in the lowest levels of “life satisfaction” since records began 22 years ago, the Australian Unity Wellbeing Index reveals. The high cost of living, worrying global politics and growing inequality are contributing factors, said Kate Lycett, the lead researcher.
On a recent morning, people waited outside a food bank at a church in Richmond, a suburb of Melbourne. The food bank helps more than 100 households and demand has increased significantly in the last six months, said Francis Flood, the coordinator.
“We're definitely helping people who, if you saw them on the street, you wouldn't think would be using a food bank,” she said.
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