Hansen Technologies Limited (ASX: HSN) shares will be in focus today following the company’s announcement it has signed a significant new contract. At Tuesday’s market close, the Hansen share price ended the day slightly lower at $4.19.

Below, we take a closer look at what the billing technology company announced to investors.

Why will the Hansen share price be in focus?

The Hansen share price could be on the move today after the company increased its full-year guidance based on the new contract win.

According to the release, Hansen has executed a master services agreement with Telefónica Germany (Telefónica). The deal will see Hansen deliver its Cloud Native Communications product suite through a prepaid subscription to support Telefónica operations.

Established in 1995, Telefónica is one of the leading providers of broadband, landline and mobile telecommunications in Germany. The company offers a range of services to private and business customers such as mobile voice and data telecommunications. Last year, Telefónica had over 44.3 million wireless customers and 2.4 million broadband subscribers.

The initial term of the deal will be five years and will generate revenue of roughly $25 million for Hansen.

CEO commentary

Hansen group CEO Andrew Hansen hailed the milestone contract, saying:

We are delighted and very proud to be engaged with Telefónica. This agreement is testament to and a ringing endorsement of the Hansen Communication Suite and Hansen’s ability to continually evolve as a valued partner to our customers.

Upgraded guidance

In news that could impact the Hansen share price today, the company upgraded its full-year guidance for FY21 as a result of securing the major contract. The company now expects revenue to be between $316 million and $326 million on a constant currency basis. Reported full-year revenue is anticipated to come in at $306 million to $316 million.

The company also advised that its underlying earnings before interest, tax, depreciation and amortisation (EBITDA) margin is projected to be higher for FY21. This is due to the total licence revenue of $21 million being recognised in the second half of FY21. Hansen believes the underlying EBITDA margin will fall somewhere around 37% to 39%.

Hansen share price snapshot

Over the past 12 months, the Hansen share price has increased by more than 36%. The company’s shares hit a low of $2.62 in April last year, before accelerating higher in August.

Based on the current Hansen share price, the company has a market capitalisation of about $834 million.

More reading

• Hansen Technologies (ASX:HSN) share price rises on profit surge

Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Hansen Technologies. The Motley Fool Australia has recommended Hansen Technologies. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Immutep Ltd (ASX: IMM) shares will be on watch this morning after the company announced it has secured a second United States patent for eftilagimod alpha. The Immutep share price ended Tuesday’s trading session up 8.1% to 33 cents.

Immutep is a global biotech that is focused on developing immunotherapy therapies for cancer and autoimmune diseases. Its lead product, eftilagimod alpha, is a soluble LAG-3Ig fusion protein based on the LAG-3 which is in clinical development.

New patent added

The Immutep share price could be on the move today following the company’s latest update released after yesterday’s market close 

According to its release, Immutep has been granted patent number 10,940,181 by the United States Patent & Trade Mark Office. The new patent is titled, ‘Combined Preparations for the Treatment of Cancer or Infection’.

This follows a previous patent that was announced by the company on 30 December 2020.

The new patent builds another layer to the protection of Immutep’s intellectual property. In particular, it relates to methods of treating cancer by administering the company’s lead drug candidate, eftilagimod alpha, in combination with a PD-1 pathway inhibitor.

The expiry of the additional patent falls on 20 January 2036.

In other news that could impact the Immutep share price today, the company noted it has filed another divisional application to expand on other related aspects of its invention.

Words from the head of Immutep

Immutep CEO Marc Voigt hailed the company’s progress in securing the new patent. He said:

We are very pleased to add another United States patent to our expanding patent portfolio, especially in this case, because of its direct relevance to our clinical development programs. These patent grants are important as they underpin ongoing investment in clinical development of efti and allow us to confidently engage in business development discussions.

Immutep share price review

The Immutep share price is down just over 4% when looking at its chart over the past 12 months. Immutep shares dropped steeply last March from 30 cents to an all-time low of 10 cents. While its shares slowly recovered over the remainder of 2020, they spiked in December from the results of the company’s breast cancer trial.

Since then, profit taking and weak market sentiment have steadily led Immutep shares lower. 

More reading

• Why is the Immutep (ASX:IMM) share price dipping today?

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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There are some great S&P/ASX 200 Index (ASX: XJO) blue chip shares out there available to Australians. A few could be worth looking at right now.

A few ASX 200 shares have dropped significantly over the last year such as AGL Energy Ltd (ASX: AGL), Orica Ltd (ASX: ORI) and Insurance Australia Group Ltd (ASX: IAG).

These two could be top ideas for considering:

Wesfarmers Ltd (ASX: WES)

Wesfarmers is one of the ASX 200 shares that is experiencing a higher level of growth through this strange period of time due to the impacts of COVID-19.

It has many recognisable retail businesses in its stable, including Kmart, Target, Catch, Bunnings and Officeworks. Wesfarmers also has some industrial businesses. There’s a group of businesses within the chemicals, energy and fertilisers (WesCEF) division including CSBP, Australian Vinyls, Australian Gold Reagents, Queensland Nitrates. Other industrial businesses include Blackwoods, Greencap and Workwear.

Bunnings is by far the key business, generating over half of the company’s operating earnings before tax (EBT).

In the FY21 half-year result, Bunnings generated 24.4% growth of revenue to $9 billion and earnings excluding the net contribution from property went up 39%. However, there was also strong growth from Kmart Group and Officeworks.

Looking ahead, Wesfarmers said that economic conditions in Australia have recovered strongly and the outlook is more positive, subject to future COVID-19 risks.

The ASX 200 blue chip share said that the portfolio of cash-generative businesses have leading market positions and remain well-placed to deliver satisfactory shareholder returns over the long-term.

However, the company noted that retail sales growth is expected to moderate from March as the businesses begin to cycle the initial impacts of COVID-19 in the prior year, particularly in Bunnings and Officeworks.

Wesfarmers also hinted that it’s looking to find acquisition opportunities when it said:

The group will continue to develop and enhance its portfolio, building on its unique capabilities and platforms to take advantage of growth opportunities within existing businesses and to pursue and transactions that create value for shareholders over the long term.

According to Commsec, the Wesfarmers share price is trading at 24x FY21’s estimated earnings.

APA Group (ASX: APA)

APA Group’s share price has dropped 14% since 5 November 2020. The ASX 200 energy infrastructure business has seen activity moderate in FY21 due to COVID-19 effects.

The business said that NT, WA and some sections of the east coast have seen good volume growth, but in Victoria there has been weaker contract renewals as well as lower energy consumption.

Looking at the financial numbers, APA’s half-year earnings before interest, tax, depreciation and amortisation (EBITDA) dipped 2.3% and underlying net profit fell 7% to $163 million. The reported bottom line was a net loss of $11.7 million because of a non-cash impairment recognised against the Orbost Gas Processing Plant of $174.5 million.

Despite all that, APA said that its delivered essential services delivery reliability and there was a successful major overhaul of the Diamantina Power Station.

The ASX 200 blue chip share continues to invest, it’s now expecting organic growth capital expenditure to be more than $1 billion over FY21 to FY23. APA believes it will play a central role in supporting the federal government’s plans for a gas-led economic recovery.

Based on the FY21 distribution guidance of 51 cents per security, it has a forward distribution yield of 5.4%.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• ASX 200 rises, Afterpay sinks, Vocus jumps
• Latest broker ASX buy ideas for 2021
• Can ASX bank shares keep rallying after hitting 52-week highs?
• ASX 200 up 0.7%: Vocus jumps on takeover update, Afterpay crashes 9%

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of APA Group and Wesfarmers Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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It finally looks set to be a good day for Australian tech shares on Wednesday.

This follows a very positive session on Wall Street’s technology-focused Nasdaq index overnight.

What happened?

Investors were fighting to buy beaten down US tech stocks after bond yields declined on Tuesday.

According to CNBC, the US 10-year Treasury yield fell more than 6 basis points to 1.52% yesterday. This means the benchmark rate is now down 10 basis points from its Monday high of 1.62%.

The tech-heavy Nasdaq Composite index climbed over 4.1% overnight thanks to very strong gains by giants such as Amazon, Apple, Facebook, and Tesla. The latter was a particularly positive performer, wiping out almost five days of declines by rising over 20%.

Vital Knowledge’s Founder, Adam Crisafulli, commented: “After lagging badly for the last few weeks, growth/momentum stocks are exploding higher as investors grow a bit more comfortable around rates and step in to buy this erstwhile most-loved sector.”

Will this rebound be sustained?

Miller Tabak’s Chief Market Strategist, Matt Maley, appears cautious on the rebound and unsure whether it is going to last.

Mr Maley said: “A lot of these tech stocks have become oversold on a short-term basis. Therefore, it’s not a big surprise that they’re seeing a nice bounce. The question will be whether this bounce is a strong one…or a ‘dead cat bounce’ that doesn’t last very long at all.”

But one thing that is for sure, is that it looks set to be a very good day of trade for beaten down Australian tech shares such as Afterpay Ltd (ASX: APT), Altium Limited (ASX: ALU), and Zip Co Limited (ASX: Z1P) on Wednesday.

With their shares down heavily over the last month, as outlined here, they look likely to follow the lead of their US counterparts and rebound strongly today.

More reading

• 5 things to watch on the ASX 200 on Wednesday
• ASX 200 rises, Afterpay sinks, Vocus jumps
• 2 ASX tech shares to buy after the selloff
• ASX tech correction? 10 of the worst-hit shares
• Why did the Openpay (ASX:OPY) share price slide today?

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Altium. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of AFTERPAY T FPO and ZIPCOLTD FPO. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Are you looking for some ASX dividend shares to add to your income portfolio? 

Then you might want to take a look at the dividend shares listed below. Here’s what you need to know about them:

BWP Trust (ASX: BWP)

BWP is the largest owner of Bunnings Warehouse sites across Australia with 68 properties leased to the home improvement giant.

Bunnings has proven to be a great tenant to have during the pandemic. With many consumers redirecting their spending to improving their homes, Bunnings has experienced very strong sales growth. This means BWP has been one of just a handful of retail landlords that has been able to collect rent largely as normal.

This and positive property revaluations led to the company’s profit climbing 6% to $144 million during the first half of FY 2021.

In addition to this, its solid form has allowed management to reaffirm its distribution guidance of ~18.3 cents per share in FY 2021. Based on the current BWP share price, this represents a generous 4.8% dividend yield.

Westpac Banking Corp (ASX: WBC)

With trading conditions in the sector improving rapidly, this banking giant could be a good option for income investors.

Last month Westpac released its first quarter update and reported a $1.97 billion first quarter cash profit. This was more than double the quarterly average cash earnings it recorded during the second half of FY 2020. In addition to this, the bank reversed ~$500 million of COVID-19 related impairments due to the improving economic conditions.

This went down well with Morgans, which put an add rating and $27.50 price target on its shares. The broker is also forecasting a fully franked $1.32 per share dividend in FY 2021.

Based on the current Westpac share price, this represents a generous 5.3% dividend yield. This is significantly better than anything you’ll receive from its term deposits or savings accounts.

More reading

• Can ASX bank shares keep rallying after hitting 52-week highs?
• Is the Westpac (ASX:WBC) share price a buy for a 6.3% dividend?
• Why the Westpac (ASX:WBC) share price just hit a 52-week high
• ANZ (ASX:ANZ) hits 3 year high. Can we thank dividends?
• ASX 200 Weekly Wrap: ASX finishes higher, despite tech selloff

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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On Tuesday the S&P/ASX 200 Index (ASX: XJO) was on form again and pushed higher. The benchmark index rose 0.5% to 6,771.2 points.

Will the market be able to build on this on Wednesday? Here are five things to watch:

ASX 200 futures pointing higher

It looks set to be another positive day for the Australian share market on Wednesday after Wall Street rallied higher. According to the latest SPI futures, the ASX 200 is poised to open the day 27 points or 0.40% higher this morning. In late trade in the United States, the Dow Jones is up 0.8%, the S&P 500 is up 2%, and the Nasdaq index is trading 4.1% higher.

Tech shares to rebound

It looks set to be a very good day for Australian tech shares such as Afterpay Ltd (ASX: APT) and Altium Limited (ASX: ALU) on Wednesday. This follows a material rebound on the Nasdaq index overnight. In late trade the tech-heavy index is up a massive 4.1%. Among the biggest movers has been electric vehicle giant Tesla with a 20% gain. A decline in bond yields sent investors rushing back into beaten down tech stocks.

Oil prices drop

Energy producers such as Beach Energy Ltd (ASX: BPT) and Santos Ltd (ASX: STO) could come under pressure today after the oil price rally fizzled out. According to Bloomberg, the WTI crude oil price is down 1.7% to US$63.94 a barrel and the Brent crude oil price has fallen 1.1% to US$67.45 a barrel. Easing concerns of supply disruptions in Saudi Arabia weighed on oil prices.

Gold price rebounds

Gold miners Evolution Mining Ltd (ASX: EVN) and Resolute Mining Limited (ASX: RSG) could charge higher today after the gold price rebounded. According to CNBC, the spot gold price is up 2.2% to US$1,716.20 an ounce. Traders were buying gold after bond yields pulled back.

Shares going ex-dividend

Another group of shares will be going ex-dividend this morning and could trade lower. This includes logistics solutions company Brambles Limited (ASX: BXB), horticulture company Costa Group Holdings Ltd (ASX: CGC), gold miner Regis Resources Limited (ASX: RRL), and plumbing parts company Reliance Worldwide Corporation Ltd (ASX: RWC).

More reading

• ASX 200 rises, Afterpay sinks, Vocus jumps
• 2 ASX tech shares to buy after the selloff
• ASX tech correction? 10 of the worst-hit shares
• Why did the Openpay (ASX:OPY) share price slide today?
• Latest broker ASX buy ideas for 2021

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Altium. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of AFTERPAY T FPO and Reliance Worldwide Limited. The Motley Fool Australia owns shares of and has recommended COSTA GRP FPO. The Motley Fool Australia has recommended Reliance Worldwide Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Zimplats Holdings Ltd (ASX: ZIM) share price surged over 10% higher today to hit an all-time high. For the first time ever, shares in the platinum miner closed at $20.05 – up on yesterday’s close of $18.15.

The S&P/ASX 200 Index (ASX: XJO) by comparison, performed at a more mediocre level. The index was only up 0.5% at close of trade.

Let’s take a closer look at what Zimplats does and why investors are going crazy for it.

What does Zimplats do?

Zimplats is a platinum miner based in Zimbabwe. It specialises in the extraction of six elements: platinum, palladium, iridium, ruthenium, osmium, and rhodium. The last element, rhodium, is the key to its astronomical share price rise.

According to the Royal Society of Chemistry, rhodium is the rarest non-radioactive element on Earth. Only 30 tonnes of the metal are produced a year. Some of its uses include fibre optic cable coating, crucible manufacturing, and headlight reflectors.

Rhodium’s most important use, however, is in car exhausts.

The element is used as a catalyst in cars to reduce the amount of nitrogen oxide in exhaust fumes. Nitrogen oxide is an air pollutant. The website Trading Economics claims many car manufacturers are increasingly demanding rhodium as nations around the world increase environmental regulations. Supply has also diminished due to COVID-19 work stoppages. As a result of this increasing demand and decreasing supply, rhodium’s price is surging.

The other element going gangbusters on increased environmental considerations is lithium.

At the moment, the metal is selling for US$29,200 an ounce in the commodities market. It’s up 34% in the past month and 71.8% over the year. To put that in perspective, gold is valued at $1,689 an ounce and has fallen 8.37% in the past month.

Zimplats performance reflects the success of rhodium. In its half-yearly report for FY21, the company’s net profit after tax increased 209% on the prior corresponding period (pcp) to total $251 million. Revenues were up 79% on the pcp.

The company paid a 40.88 cent dividend to its shareholders for the half-year.

Zimplats share price snapshot

Only 1 month ago, the Zimplats share price was $12.33. At today’s price that’s a 62.6% increase in just over 4 weeks! Near the end of March last year, the share price was at a 52-week low of $6.96. If an investor was smart enough to purchase into the company then, they would be sitting on a monumental 188.1% return on investment.

After today’s successes, Zimplats market capitalisation is now $2.2 billion.

More reading

• ASX 200 rises, Afterpay sinks, Vocus jumps
• Saxo Bank CEO on the “seismic shift” in ASX retail investors
• Is Australia’s stagnant wage growth worse than we thought?
• Here are the US shares ASX investors have been buying
• 2 ASX tech shares to buy after the selloff

Motley Fool contributor Marc Sidarous has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The S&P/ASX 200 Index (ASX: XJO) went up by around 0.5% today to 6,771 points.

Here are some of the highlights from the ASX today:

Vocus Group Ltd (ASX: VOC)

The best performer in the ASX 200 today was Vocus, rising by around 8.5%.

Vocus announced that it has agreed to enter into a scheme implementation deed with a consortium comprising Macquarie Infrastructure and Real Assets (MIRA) and its managed funds, as well as Aware Super. In other words, it accepted the takeover offer.

The accepted offer is $5.50 cash per share.

The Vocus Chair Bob Mansfield said:

The Vocus board is unanimous in our view that this offer is in the best interest of Vocus shareholders. In making this assessment, the board considered a range of alternatives, including the execution of our existing strategy under which the proceeds of an IPO of Vocus New Zealand would reduce debt and be invested in our core business. Feedback from shareholders in recent weeks on the indicative offer of $5.50 originally received from MIRA has been overwhelmingly positive and there is broad recognition that this is a very fair value for Vocus shareholders.

Insurance Australia Group Ltd (ASX: IAG)

The IAG share price was one of the most volatile shares in the ASX 200 today.

Whilst it ended the day 4% lower to $4.62, it went as low as $4.32 just after midday on worries about its exposure to Greensill.

IAG said that in response to market enquiries, the ASX 200 company said that it has no net insurance exposure to trade credit policies, including those sold through BCC Trade Credit to Greensill entities.

The insurance giant solid its 50% interest in BCC on 9 April 2019 to Tokio Marine Management with the result of eliminating net exposure to trade credit insurance.

In addition to extensive reinsurance placed by IAG, as part of the sale IAG entered into agreements with Tokio Marine for it to hold any remain exposure to trade credit insurance written by BCC through Insurance Australia Limited.

Big ASX 200 market movements

In the ASX 200 there were strong market movements both positively and negatively.

At the red end of the ASX 200, the Pro Medicus Ltd (ASX: PME) share priced dropped 5.7%, the Megaport Ltd (ASX: MP1) share price fell 4.4%, the Xero Limited (ASX: XRO) share price declined 3.8%, the Afterpay Ltd (ASX: APT) share price fell 3.6% and the Zip Co Ltd (ASX: Z1P) share price fell 1.6%.

However, there were also some positive gains for the travel industry, including the Corporate Travel Management Ltd (ASX: CTD) share price which rose 7.5% and the Webjet Limited (ASX: WEB) share price which rose almost 5% after the Prime Minister said that the aviation and travel sector will continue to receive government subsidies.

More reading

• ASX tech correction? 10 of the worst-hit shares
• Why did the Openpay (ASX:OPY) share price slide today?
• Latest broker ASX buy ideas for 2021
• IOUpay and Zip were among the most traded ASX shares last week
• Credit Suisse just rated the Afterpay (ASX:APT) share price as ‘outperform’

Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends MEGAPORT FPO and Pro Medicus Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of AFTERPAY T FPO and ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended Corporate Travel Management Limited and Webjet Ltd. The Motley Fool Australia owns shares of Xero. The Motley Fool Australia has recommended MEGAPORT FPO and Pro Medicus Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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In case you needed any more evidence of the rising influence of retail investors, Saxo Bank Group’s 2020 results provide it.

In 2020 Saxo reported it brought on a record 238,000 new active clients globally. This brought its total number of active clients to 660,000, also a record for the company.

Huge Aussie retail investor growth

Adam Smith, CEO Saxo Capital Markets Australia, told the Motley Fool that Saxo’s Australian trading client base had also seen phenomenal growth, up 56% in 2020. And the number of new clients who placed their first trade with Saxo in 2020 increased 114%.

Kim Fournais, CEO and founder of Saxo Bank, cited, “a seismic shift that has sparked much greater participation in financial markets.”

Fournais added:

[T]he empowerment of retail investors is fundamentally positive – as they take ownership of their investments to better navigate their financial future, and also harness the benefits of long-term compounded growth, that only investments can offer over time.

The incoming tide of ASX retail investors

So what’s driving ever more Aussies to invest in shares?

According to Adam Smith:

In recent years retail investment has been on the rise with people increasingly driven towards self-directed investing and trading. Meanwhile the events of the past year have accelerated the move to online retail investment, much in the same way as we’ve seen ecommerce going through the roof – it’s simply a build on an existing trend.

Smith says that Saxo’s investments into its digital platforms and the breadth of its products have helped drive its success, enabling the company, “to develop a level of quality and choice that’s ultimately built trust within our growing customer base.”

According to Smith, Australian investors are increasingly keen to invest in international shares. The recent GameStop Corp. (NYSE: GME) phenomenon is also sending more clients to Saxo’s doorstep.

We have seen a lot of stock and ESG investors come to Saxo looking for access to global markets as the breadth of our international stock and ETF offering is unique in the local market.

More recently, since GameStop hit the headlines, clients have contacted us regarding short squeeze stocks and how to manage risk around those investments.

There is no doubt that GameStop accelerated interest in retail investment, but that trend towards greater participation in financial markets already existed. Especially throughout 2020 when investors saw opportunity in the volatility of the capital markets and felt empowered to take advantage of it.

This empowerment is in part down to the availability of digital trading platforms, as well as access to the advice and resources required to undertake risk management.

Smith stresses that brokers have “a huge responsibility” to educate newbie investors on this front. While times of volatility provide some big opportunities, those do not come without risk.

With far more investors in the world than traders, he says Saxo will continue its focus on offering international investment opportunities.

More reading

• Here are the US shares ASX investors have been buying
• Goldman Sachs CEO: GameStop share price and the Reddit phenomenon
• Subreddit ASX Bets is gambling these 4 ASX shares will follow in GameStop’s footsteps
• The risky nature of Robinhood style day trading revealed
• Is Reddit’s GameStop (NYSE:GME) crowd targeting Asian shares?

Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Australia is currently approaching its 10th year of wage stagnation and underemployment, and Professor Ross Garnaut, the University of Melbourne’s Professorial Research Fellow in Economics, believes the situation is worse than we think.

Professor Garnaut was quoted by the ABC as saying the increasing incomes of Australia’s largest earners have been disguising falling wage growth for everyday Australians.

EY.com reported there are approximately 44 million hours each week of spare capacity in Australia’s labour market. That equates to $649 million a week not reaching household pockets.

In his new book, Reset: Restoring Australia after the Pandemic Recession, Professor Garnaut has described the Australian economy between 2013 and 2019 as the “dog days”, and said the government’s actions keep Australian’s underemployed.

He commented:

Economic growth continued from 2013, but with much slower growth in total output, stagnant output per person, and decline in the typical household’s real wages and income per person.

In the seven years from 2013 to 2019, the whole developed world experienced slow and grumpy times, [but] Australia drifted to the back of a slow-moving pack.

Underemployment has grown and grown. Average household disposable income ended the seven lean years where it began.

What’s to blame for Australia’s wage stagnation?

According to Professor Garnaut, wage stagnation is a result of changes to Australia’s immigration policy and the drive towards a budget surplus.

The Howard Government’s immigration policy, continued by successive governments, has resulted in the nation’s population growing 35% over 20 years. Further, a shift away from permanent migration and towards temporary migration integrated the Australian labour market with the global one.

“It contributed to persistent unemployment, rising underemployment and stagnant real wages during the expansion of total economic activity during the Dog Days”, said Garnaut.

Professor Garnaut also commented that the increase in migrants allowed breaches of labour laws to become common, as workers had less knowledge of their rights. An example of such is the infamous 7-Eleven wage fraud scandal.

He also blamed successive federal treasurers’ obsessions with a budget surplus for stagnating wage growth, saying that, by taxing more than they invested into the community, governments have short-changed Australians by slowing down the economy and lessening people’s spending power.

How can investing help those affected by wage stagnation?

If a person’s household income is stagnant, with no signs of gaining momentum again, investing may provide another much needed income source. 

Investing is a popular means of generating passive income, although care must be taken while doing so.

At the moment, low interest rates and rising bond prices mean that cash savings accounts and investment grade bonds aren’t as prosperous as they have been in the past.

One option for receiving a passive income from investing in 2021 is to invest in dividend-paying shares.

Dividend paying shares entitle shareholders to a share in a company’s profits. Most dividend paying companies listed on the ASX pay dividends twice a year, but they can pay more often, or even as a once-off. It’s never guaranteed that a company will pay its shareholders a dividend, but not doing so is often detrimental to its share price.

Like all investing, a personal approach must be taken when investing in dividend shares, and your individual situation must be considered before taking action.

3 high-paying dividend shares on the ASX 200

Aurizon Holdings Ltd (ASX: AZJ)

The largest rail freight operator in Australia has a current dividend yield of 7.74%.

Aurizon’ share price boasts a relatively stable performance history and the company has a market cap of $6.71 billion. Its share price is currently $3.71 apiece.

Rural Funds Group (ASX: RFF)

Rural Funds Group owns a diverse portfolio of Australian agricultural assets, leased predominantly to corporate operators. It has a target distribution growth of 4% each year, which it aims to achieve by owning and improving farms and leasing them to counter-parties.

Its current dividend yield is 4.73% and its share price has a 24% return on investment over the last 12 months. Right now, Rural Funds Group’s share price is $2.32.

Australia and New Zealand Banking Group Ltd (ASX: ANZ)

Australia and New Zealand Banking Group, more commonly known as ANZ, didn’t pay out near the dividends this year as it has in the past. But it is predicted to bounce back in the near future.

ANZ has a market capitalisation of approximately $81 billion. Its current share price is $29.48.

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The Motley Fool Australia owns shares of and has recommended RURALFUNDS STAPLED. The Motley Fool Australia has recommended Aurizon Holdings Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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