Australia's collective wellbeing has taken a backward step since the Coalition won office a year ago as national income declined, growth in our shared knowledge stalled and long-term unemployment rose.

The Fairfax-Lateral Economics wellbeing index, which puts a dollar figure on national wellbeing, fell by $2 billion in the June quarter and is $10.5 billion lower than a year earlier.

Wellbeing has now declined in four consecutive quarters for the first time since the global financial crisis. When gross domestic product declines for two consecutive quarters the economy is deemed to be in recession.

The index provides a deeper measure of national welfare than GDP by measuring changes in six key components: income, knowledge (called human capital), the environment, inequality, health and job satisfaction. GDP only measures the market value of all goods and services produced in the national economy during the year.

The findings of the wellbeing index – which declined by 2.8 per cent in the year to June – tells a different story to GDP, which grew by 0.5 per cent in the June quarter and 3.1 per cent for the year.