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When Queensland's booming economy is not enough to win the race

Business

Queensland’s economic growth was up 12 per cent and housing finance was running at 65 per cent above the decade average last quarter, but the state still languishes at seventh place in the economic performance of the nation, according to CommSec.

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With several of its key indicators booming, the report, if anything, shows that a “normal economy’’ in Queensland is a hard thing to pin down.

For the seventh quarter in a row, Tasmania was the best performing economy. 

“It leads on four of the eight indicators (construction, retail spending, relative unemployment and dwelling starts) and ranked second on another three indicators (equipment investment, relative economic growth and relative population growth),’’ CommSec said.

But the report compares “the key indicators to decade averages; that is, against “normal” performance’’. 

But a decade ago, Queensland was in the middle of a mining and resources boom during which the $70 billion LNG industry took hold with construction running alongside several mining development projects.

According to CommSec, Queensland’s dwelling commencements were up 21 per cent in the last quarter compared with the decade average. The state’s record-low unemployment level at 4.9 per cent was down 20 per cent on the decade average.

Retail spending increased 15 per cent but construction work fell 23 per cent and population growth in the quarter was down 46 per cent.

Queensland is ranked third on relative population growth, relative unemployment and retail trade

“Queensland would be a key beneficiary of the opening of borders with inter-state and overseas tourism driving spending and employment. Queensland and Northern Territory will be supported by population growth and higher commodity prices,” CommSec economist Craig James said.

“Overall, Australia’s state and territory economies are in strong shape, well supported by significant fiscal and monetary stimulus. Unemployment rates are historically-low across much of the nation – remarkable when you consider the COVID-19 challenges and when the broader Australian economy was in recession just over a year ago.’’

However, there is little to separate the other states and territory economies. The ACT is second; Western Australia and NSW are equal third; South Australia and Victoria are equal fifth; Queensland is seventh; and the Northern Territory is eighth.

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