Feeling miserable? You’re far from alone – and our index proves it

August 13, 2026 — 5:00am

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How miserable are you feeling?

The misery index was created by economist Arthur Okun who, in the late 1960s, put his mind to the types of situations that make people – and their countries – feel pretty rotten.

Okun’s index was simple. Add unemployment to the inflation rate and you have a pretty rudimentary, and pretty accurate, insight into misery. The higher the index, the more miserable the population.

If prices are going up and people are losing jobs, then households and businesses can rightfully think the economy is not working for them. They may be miserable. They may also get angry.

Okun had only two factors in his index. In Australia, we need another: the official cash rate.

When you add the cash rate to inflation to unemployment right now, you can see the pickle that Treasurer Jim Chalmers and Reserve Bank governor Michele Bullock – and the rest of us – find ourselves in. This also provides an insight into why the far right and far left are attracting so much interest from voters.

For the Australian misery index (*trademark pending) has climbed sharply this year.

By my reckoning, it was at its most recent low point around March 2025, the time of the federal election that Anthony Albanese so easily won. Inflation was 2.1 per cent, the jobless rate was 4.1 per cent, and official interest rates were 3.85 per cent.

But it started climbing from the middle of the........

© The Age