In yesterday’s blog I had a look at which side of politics presided over stronger jobs creation when in office. The results confirmed that the rate of job creation is stronger whenever Labor is in power, pulling the economic levers, compared with the times when the Coalition is in office.
The obvious follow up was to see which side of politics presides over a stronger pace of real GDP growth.
The results are set out below. The figures are average quarterly growth in real GDP.
Using a weighted average for the period since Fraser in 1975, the overall result was:
So there you have it. When Labor are in office, the economy grows faster, by about 0.06 per cent per quarter. which in a year is about 0.25 per cent faster. In an economy that in today’s terms is above $1.6 trillion, a quarter of a percentage point extra GDP growth a year is big bikkies. The stronger GDP growth helps explain, no doubt, why job creation is faster when Labor are in power.
I look forward to updating these results in coming quarters and years.