Men's underwear, lipstick... what's going on with our economy?
Tags: economy, economic indicators
The share market is down, the Aussie dollar is down, and in the last quarter the economy barely grew. China is cutting back on construction, the mining boom is over, and global share markets rise one day only to plummet the next.
Listen too much to mainstream media and it would be easy to conclude that we are going down the economic drain. And sure, there are sectors doing it tough. But the economy is a big and complex beast, so in times like these it’s important to keep all the gloomy economic news in perspective.
The real world
For most people, a little slowing in the economy is barely noticed. Most will keep their jobs or find new ones. Pensions will continue to be paid, the shops will be open, and life will pretty much continue as normal. Maybe incomes won’t go up as much as they might have, and some people may need to buy a little less stuff this year. On the other hand, a downturn may mean that some living costs ease, and for investors, the drop in share prices can be an opportunity to pick up some bargains.
Without trivialising the real pain that some people experience when the economy takes a dip, the old saying about clouds and silver linings holds true. To find out what some of these silver linings are we can look to some unusual economic indicators that point to what’s going on in the real world.
Ties up, underpants down
Take the Men’s Underwear Index. When belts need to be tightened, sales of men’s underwear decline as blokes extract maximum value from their Y-fronts. On the other hand, sales of ties increase as men seek to maintain a professional image.
According to Leonard Lauder of Estee Lauder Inc., women’s collective view of the state of the economy is revealed by the Lipstick Index. Lipstick sales jump significantly during recessions as women opt for smaller, affordable luxuries rather than more expensive handbags and shoes.
Cinemas benefit from economic downturns with people escaping to the movies for some respite. The Movie Index might be related to the First Date Index. Data from online dating websites reveals that more people go looking for (and hopefully finding) love as the economy slows.
Beyond dollars and cents
Sometimes it’s easy to get the feeling that economists and politicians believe that the only valid measure of our collective well-being is Gross Domestic Product (GDP), but if that was the case Bhutan should be one of the unhappiest countries on Earth. Instead, this tiny nation developed the Gross National Happiness Index and found itself to be one of the happiest!
So, what’s the collective mood “down under”?
As it happens, Australia also does pretty well when to comes to contentment. In 2014 our overall satisfaction with life as a whole came in at 7.7 out of 10, significantly ahead of the OECD average of 6.6. And perhaps surprisingly, the older we get the more contented we tend to be.
Now there’s a thought that should help us all put short-term downturns into perspective.
