The Australian economy emerged from recession in the second half of 1991, but the recovery was initially very weak, slow and restricted to the household and housing sectors. It was termed the ‘jobless recovery’ because even though real GDP was rising, employment growth was negligible, and unemployment remained at unacceptably high levels. Recovery strengthened in 1993-94, but there was no discernible fall in unemployment, and business investment continued to be weak. However, the strong growth recorded in 1994 led the government to forecast in its May 1994 budget growth of 4.5 per cent for 1994-95, largely driven by a pick up in private business investment of 14.5 per cent.

A sustainable recovery where strong economic growth leads to job creation and investment spending (without high inflation and external debt) was encapsulated in the Economics ’94 Conference theme of ‘Creating Jobs by Investing in Growth’. Each of the 10 conference papers addressed particular issues raised by the conference theme in the context of providing a professional update for the teachers who attended Economics ’94.