Assesses, in general terms, key trends in various cost of living measurements (including the consumer price index), as well as wage indexes in Australia.
A significant concern for many households is the expense they incur to buy goods and services that are necessary to maintain a certain standard of living – that is, their ‘cost of living’.
Cost of living is an issue that dominates political and social debate, particularly with regard to housing expenses, petrol, electricity and grocery prices. It has often been claimed that the cost of living in Australia is out of control and that household incomes are falling behind that cost of living.
The reality is that prices almost always rise, so it’s understandable this would cause concern in the community. For many groups such as the unemployed, students, pensioners, people with disabilities and low income working families, making ends meet is often a daily struggle.
This paper doesn’t attempt to argue against this. Rather, it considers, at an aggregate level, just whether these cost of living pressures are getting worse relative to wages growth; and also whether the cost of living pressures are being felt more acutely by certain demographics in Australia.
If this isn’t actually the case, could it be that these cost of living pressures are driven by greater expectations or societal changes?
This e-brief assesses, in general terms, key trends in various cost of living measurements (including the consumer price index), as well as wage indexes in Australia. By drawing on literature from the Reserve Bank and the National Centre for Social and Economic Modelling, this paper also provides an evaluation of standard of living changes in Australia.