Mining powerhouse rockets to top spot
Written by admin on October 28, 2024
Mining powerhouse Western Australia has topped CommSec’s closely watched State of the States report on economic performance for the first time in 10 years.
The quarterly report, which ranks each state and territory on eight key indicators, says WA now leads the nation on retail spending, unemployment and population growth.
“Western Australia’s robust economic fundamentals, especially its low unemployment and strong population growth, has fuelled nation-leading consumer spending, pushing the state to the top of the leaderboard for the first time in a decade,” CommSec chief economist Ryan Felsman said.
“WA is well positioned for sustained future performance, however, the competition remains intense, particularly among the top three states with Queensland moving quickly up the rankings.”
WA’s economy is heavily tilted towards resources, with mining giants Rio Tinto and BHP digging up huge volumes of iron ore from the Pilbara for export to Asia and oil and gas giants Woodside Energy and Santos with their own vast operations in the energy space.
The resource-rich economy has produced the strongest job market in the country, the report states, with trend unemployment at 3.7 per cent in September.
Population is also booming out west, with a 3.1 per cent annual population growth rate.
The state is also performing well in other indicators.
For equipment investment, which measures spending on new plant and equipment, it comes in second place behind Tasmania, with a 25.7 per cent lift in spending across the quarter.
On housing finance commitments, it is in second place behind Queensland, with the value of home loans in WA up 36.2 per cent.
Housing finance serves as a leading indicator for real estate activity and housing construction.
“Looking ahead, Western Australia could consolidate its position atop the leaderboard given its strong recent economic performance,” the report states.
But there are also some troubling measures for WA, with Perth recorded the highest inflation rate in the country at 4.6 per cent.
While WA is booming, NSW and the Northern Territory are struggling, finding themselves in seventh and eight position overall, respectively.
Overall, Mr Felsman said the strength of state and territory economies was being driven by a resilient job market and solid population growth, but warned of issues that would effect the future.
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“However, an extended period of elevated interest rates to counter persistent inflation is pressuring consumers and slowing economic momentum,” he said.
“The path forward will largely depend on the ongoing strength of the labour market, trajectory for monetary policy and China’s economic recovery.”
The Australian Bureau of Statistics will release inflation figures for the September quarter on Wednesday, which will influence the Reserve Bank board’s deliberations on the official cash rate at its meeting on November 4 and 5.
Read related topics:Perth
