Breakfast

The news was dominated this week by the first cut in official interest rates in seven years. It was greeted warmly, not the least by the Rudd government, because it would put around $40 a month back into the pockets of struggling Australians with an average-sized mortgage.

But it was also bad news, as the Federal Opposition was keen to point out, because it signified the economy was slowing and that unemployment would eventually rise. The economic good times saw Australia's jobless rate fall to generational lows. But economists agree it will soon start ticking up again as the slowdown starts to bite into company profits.

But how high will unemployment go during this downturn? Could it reach the heights of the 1990s recession when the proportion of jobless hit eleven per cent, and what will that do to consumer confidence?

Guests

Heather Rideout
Chief Executive, Australian Industry Group

Professor Bill Mitchelll
Director, Centre for Full Employment and Equity, University of Newcastle.

Michael Blythe
Chief Economist, Commonwealth bank

Reporter

Breakfast Business Editor Sheryle Bagwell

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