Industry spectators call on RBA to be more proactive

The property management industry could be facing uncertain times if the Reserve Bank of Australia (RBA) continues with its current approach to monetary policy, according to one industry spectator.

Chief economist at Westpac Bill Evans has warned that the economy may experience an uncontrolled rise in the rate of unemployment if interest rates are left unchanged.

Evans asserted: "The RBA will be aware that the unemployment rate continues to rise long after the first rate cut in the cycle."

Many financial institutions base their interests payments on figures determined by the RBA. If other factors change - such as increases in the costs of energy - businesses and households will find that they have less funds available to spend.

Companies may find that they are no longer in the position to maintain current staff levels at the current wage levels - in these cases they may find that the only options are to reduce staffing costs.

The knock-on effect is that the employees are made jobless while organisations run at reduced capacities.

From there it is only a matter of time before both elements combine to affect spending on property management programs and other investment opportunities - with funds going to other, more essential areas such as food and clothing.