Tasmania leads Australian economies
Tasmania remains at the top of the rankings after leading three of the eight economic indicators used in the Quarterly State of States Report. These were relative economic growth, relative population growth, and investment in equipment.
Equipment investment in Tasmania increased 27.8% from the decade average. Investment increased by 43.5% compared to the previous year.
The territory leads a relative economic growth. ACT’s economic activity in the period up to December was 22.1 percent above its “normal” or decade-average output level, ahead of Western Australia with a production 19.3 percent above the “normal” production level.
ACT recorded the fastest nominal economic growth, up 5.2 percent in the year ending December, supported by a strong labor market.
It was also the best performer for retail spending, 19.4 percent above decade average levels in the December quarter, ahead of Tasmania and Queensland.
It also exceeded the measure of relative unemployment. Despite the Covid-19 shock, unemployment in ACT is 3.4 percent, 14.8 percent lower than the decade average.
3. Western Australia
The CommSec chief economist said Western Australia’s robust economy could tip Tasmania to the top, supported by strong mining and residential construction markets.
It also has a strong job market with an unemployment rate of 4.8 percent, 12.6 percent below the decade average.
It also saw strong population growth of 1.24 percent, just behind Queensland at 1.33 percent.
Victoria’s construction rate is 17.5% above its 10-year average. It is a shining beacon of economic recovery for the state, which also leads the ranking for housing finance.
The value of mortgage loans in Victoria is up 87.7% from the long-term average.
Victoria moved from third place to fourth place in the last report. It was ranked seventh for relative unemployment and relative population growth.
5. South Australia
South Australia moved from third place to fifth place in this quarter’s rankings, despite strong relative population growth.
Housing starts were also strong – South Australia remained in third place with starts up 15.6% from the decade average.
With Queensland in sixth place, Commsec chief economist Craig James said the state could be the dark horse in the near future with strong population growth and housing funding.
“Queensland also has the opportunity to raise its ranking in 2021 due to the improving labor market, rising inbound migration and increasing domestic tourism demand,” James said.
The state ranked eighth for investment in equipment and relative economic growth.
7. New South Wales
Urban Taskforce chief executive Tom Forrest said New South Wales was “lagging behind”, ranking last in relative economic growth across the country.
“The NSW government oversaw a slowdown in planning approvals long before Covid-19,” he said.
“The planning system shut down at the end of 2019 and stayed there in 2020… that’s bad news for NSW.
“The real estate development and construction industry represents 10% of the economy of New South Wales.”
New South Wales also ranks last in annual population growth, the slowest in more than 25 years.
8. Northern Territory
The Northern Territory ranked second in equipment investment and sixth in relative economic growth, but continued to lag behind the rest of the country on the other six indicators according to CommSec Chief Economist Craig James .
“Equipment investment in the Northern Territory increased 53.8% in the quarter to reach 5.5-year highs,” he said.