How each state economy is performing: Westpac

How each state economy is performing: Westpac
How each state economy is performing: Westpac

In 2017/18, real economic output grew by 2.8% nationally, accelerating from 2.3% in 2016/17, according to the latest State by State Growth Report from Westpac.

The NSW economy performed over the past four years with output growth averaging an above trend 3.1% - the strongest four year performance for the state since the late 1990s.

The report found: "output growth was 2.8% in 2014/15, surging to 4.0% in 2015/16 and then moderating to 3.1% in 2016/17 and 2.6% in 2017/18 particularly as housing has become less supportive."

By industry, agriculture, real estate and professional services led the growth moderation in 2017/18.

Construction added a 0.4ppts to growth with broad strength as investment responded to the growing needs of a rising population.

How each state economy is performing: Westpac

The Victorian economy has been performing strongly, in particular, driven by a population boom.

Output growth was 3.5% in 2017/18, matching the average for the past four years but down from on last year.

Andrew Hanlan, the report author, noted: "State demand grew to 4.7% in 2017/18, up from 4.2%, the fastest pace in a decade.

"On a per capita basis, output grew by 1.2% in 2017/18, in line with the national average.

"Construction remained a key growth driver."

How each state economy is performing: Westpac

In Western Australia output bounced back from a 1.8% decline this year to grow by 1.9% this year.

The construction sector added 0.2ppts to activity in 2017/18, a turnaround from a 2.6ppts drag in 2016/17.

Mining output was a key growth driver, adding 0.8ppts, with new capacity coming on stream, according to the report.

"Consumer related sectors were subdued, significantly underperforming gains across the rest of the country as household incomes remained under pressure," Hanlan said.

How each state economy is performing: Westpac

The Queensland economy grew 3.4%, the strongest levels since 2011/12.

Construction added 0.4ppts to activity, a turnaround from a -0.1ppts impact in 2016/17 and from the sharp negatives in 2014/15 and 2015/16.

"srowth was broadly based across a range of business sectors, indicative of an improvement in underlying conditions," Hanlan said. 

How each state economy is performing: Westpac

The South Australian economy expanded by 2.0%, slightly reduced on last year's 2.4% but in line with the long term average.

This is an improvement on the previous six years, when growth averaged just 0.9%.

Andrew Hanlan found: "the health sector added an exceptional 0.8ppts to activity, well above the national average (0.4ppts) boosted by the progressive roll-out of the National Disability Insurance Scheme.

"Construction advanced, +0.3ppts, after three years of modest negatives, with home building and business investment expanding," he added.

How each state economy is performing: Westpac

The 2017/18 year was a standout for Tasmania, with output growth of 3.3%, a doubling of the 1.5% rise in 2016/17 and the strongest post GFC result in a decade.

"Per capita output growth of 2.3% in 2017/18 was the envy of all other states," stated Hanlan.

"State final demand grew by 4.1% in the year, with broad based strength across the consumer, housing, business investment and public demand."

The health sector was a key growth driver, +0.7ppts.

Of the 19 broad industries, none were a drag on activity in 2017/18 - a relatively rare outcome, Hanlan said.

Tags: 
Westpac State Economy

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