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How are Australia’s states and territories performing?

Each quarter CommSec attempts to find out by analysing eight key indicators: economic growth; retail spending; equipment investment; unemployment; construction work done; population growth; housing finance and dwelling commencements.

Just as the Reserve Bank uses long-term averages to determine the level of “normal” interest rates; we have done the same with the economic indicators. For each state and territory, latest readings for the key indicators were compared with decade averages – that is, against the “normal” performance.

The latest State of the States report also includes a section comparing annual growth rates for the eight key indicators across the states and territories as well as Australia as a whole. This enables another point of comparison – in terms of economic momentum.                                                                       

National insights
Brought to you by the CommSec Economics Team

NSW has retained top rankings on economic growth, equipment investment, retail trade, and dwelling starts. Victoria is top-ranked now on population growth and housing finance. Queensland is second-ranked on dwelling starts. Population growth is growing at the fastest annual rate in almost two years. South Australia is middle-ranked on business investment and firm real wage gains support retail spending.

The economic performance of Western Australia reflects the ending of the mining construction boom. Tasmania is the big improver; up from seventh to fourth on the performance rankings. Northern Territory has slipped from fourth to sixth spot. Slow population growth affects spending growth.

State & Territory breakdown

 

1. New South Wales

Strength: Economic Growth

Weakness: Housing Finance

 

Insights into NSW

NSW has retained its top rankings on business investment, retail trade, and dwelling starts and is now top-ranked on unemployment and economic growth. NSW is in second spot on construction work and population growth. NSW is in third spot on housing finance.

 

2. Victoria

Strength: Population Growth

Weakness: Unemployment

 

Insights into Victoria 

Victoria remains solidly in second spot on the economic performance rankings. Victoria is top-ranked on population growth and housing finance and ranked second on retail trade and business investment. Victoria is third ranked on construction work and dwelling starts.

 

3. ACT

Strength: Housing Finance

Weakness: Construction Work

 

Insights into ACT

The ACT also has held on to its position as the third ranked economy. The ACT is ranked second on housing finance, and ranked third on four other indicators.

 

4. Tasmania 

Strength: Population Growth

Weakness: Economic Growth

 

Insights into TAS

Tasmania is the big improver, up from seventh position to fourth on the rankings. Tasmania is fourth ranked on two indicators and fifth on two indicators. Annual growth on home lending is strongest in the nation at 10.3 per cent.

 

5. Queensland

Strength: Dwelling Starts

Weakness: Construction Work

 

Insights into QLD

Queensland has lifted from sixth to fifth place on the economic performance rankings. The economy is second-ranked on dwelling starts and population growth is lifting. The strong level of home building will support the job market and consumer and business investment. Queensland should also benefit from higher revenues from tourism and rural exports.

 

6. Northern Territory

Strength: Unemployment

Weakness: Population Growth

 

Insights into NT

The Northern Territory has slipped from fourth to sixth position on the economic performance rankings. The Territory is still ranked first on construction work done and unemployment and second-ranked on economic growth. But on forward-looking indicators like population growth, housing finance and home starts the Territory lags other economies.

 

7. South Australia

Strength: Business Investment

Weakness: Unemployment

 

Insights into South Australia

The South Australian economy is in seventh position. South Australia is middle ranked on business investment and fifth ranked on three indicators.

 

8. Western Australia

Strength: Retail Trade

Weakness: Unemployment

 

Insights into WA

The economic performance of Western Australia continues to reflect the ending of the mining construction boom. But the recent strong recovery in metal and mining prices and record mining export volumes are encouraging developments. Housing affordability also continues to improve with the consolidation in home prices.

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