Western Australia and the ACT remain the best performing of Australia’s states and territories, although the entire country faces challenges going forward, according to a quarterly reported issued by Commsec Research.
“Consumer conservatism and the uncertainty provided by proposed carbon and mining taxes will provide challenges for all the states and territories over the next three to six months,” Commsec Research said in its State of the States report for July 2011.
The report, undertaken each quarter, provides analysis of eight key indicators in each state and territory, namely economic growth, retail spending, equipment investment, unemployment, construction work done, population growth, housing finance and dwelling commencements.
“Provided China continues to grow then the Western Australian economy will continue to thrive,” Commsec Reserach said.
“But just as the broader Australian economy is multi speed, so is the situation in Western Australia. Mining areas are thriving but weaker housing activity is creating challenges in Perth and non-mining regional towns.”
For the ACT, above-average population growth and construction activity is providing the main impetus, although fewer jobs going forward could undermine its economic prospects, according to the report.
Victoria continues to benefit from historically-low unemployment levels, and this is supporting housing lending, retail spending and home building.
For South Australia, while stronger investment and plant and equipment spending and population growth remain strong, “home lending is under-performing other economies.”
A limp construction sector is undermining the performance of the NSW economy, although Commsec Research said population growth should bolster future spending and investment in the state.
“Tasmania has been a clear improver over the last three months benefitting from stronger construction work which is now 32 per cent above decade averages,” the report said.
“The Northern Territory maintains its top rankings on the job market and retail spending but business investment is now 39 per cent below the decade average.”
“The Queensland economy is still in the early stages of recovery from the floods and cyclone that occurred earlier this year. Once rebuilding gets fully underway it should provide momentum through the broader economy. But activity in coal producing areas is still hampered by flooding. The housing market also remains weak, whether it be new building, home lending or home prices.”