Economic lift for last-placed WA as indicators point to recovery
WA remains the nation’s worst-performed economy but is showing clear signs of improvement that could lead it out of the economic doghouse, a report out today shows.
The quarterly CommSec state of the States report confirms WA is way off the pace of other parts of the country on the back of a soft jobs market and the end of the mining construction boom.
But CommSec says there is evidence of an upturn in key parts of the WA economy that point to better days ahead.
The company measures the performance of key economic indicators against their long-term trends. At the height of the mining boom, WA was the best-performed State economy for several years before slipping to its current spot in late 2016.
Victoria is now the nation’s number one economy, overtaking NSW on the back of a lift in building.
WA is the worst-performed when it comes to construction, with activity across the State almost 40 per cent down on its average over the past decade.
The State also suffers because of its weak jobs market which, despite improving, is still lagging other parts of the country. CommSec chief economist Craig James said there had been signs of improvement, particularly in the housing sector, and population growth was stabilising.
“There are positive prospects for the WA economy,” he said. “Population growth is now the fastest in more than two years and equipment investment is at the highest level in three years.”
Other areas showing some improvement include housing finance and construction while even home prices are no longer in freefall. Despite low wages growth, lower inflation across Perth is contributing to a real increase in wages.
Mr James said there were positive signs for investment after the sharp slowdown after the end of the mining boom.