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One is the 188-year-old grand dame of the retail world. The other is a 13-year-old tech darling. Are David Jones and Canva’s troubles the ‘canaries in the coal mine’ for the Australian economy?
Canva announced plans to cut more than 1,200 jobs worldwide, and administrators took charge of Australian department store David Jones within 24 hours. The article argues that the two companies’ troubles, spanning a young technology firm and a 188-year-old retailer, highlight growing job insecurity but do not by themselves prove the Australian economy is heading into recession.
David Jones stores and its online operation remain open while receivers assess which locations can continue; the company’s landlord said it had paid little rent since September, and rival Myer could pursue parts of the business. Canva co-founder Melanie Perkins attributed the restructure to slower growth, as the company faces rising costs and competition from AI tools. HSBC economist Paul Bloxham puts the chance of recession at 50-50, while the Reserve Bank still expects growth; the article says the job prospects of displaced workers may be a better gauge of economic health.
In short
- Canva plans more than 1,200 job cuts worldwide.
- Administrators are assessing David Jones’ stores and future.
- How easily workers find new jobs may signal economic strain.
Steelman: both sides, in good faith
The strongest fair case each way — we don't pick a winner.
The case for
The simultaneous trouble at a major retailer and a prominent technology company may signal that pressure is spreading across different parts of the economy, with job cuts and uncertainty affecting workers even where headline growth continues. The recession risk is substantial enough to take seriously, and the experience of displaced workers could reveal weakness that broad forecasts have yet to capture.
The case against
Two companies facing difficulties do not establish that the wider economy is approaching recession: David Jones has longstanding business pressures, while Canva has linked its restructuring to slower growth and rising competition and costs. The Reserve Bank still expects economic growth, and assessing the broader outlook requires evidence across many businesses and sectors, not these cases alone.