According to the Commonwealth Bank’s state of the states survey, Queensland has topped the nationwide ladder of economies, mainly because of the Covid inspired population boom, which may not be sustainable and has been a factor in the housing crisis.
“Queensland has benefitted from an inflow of migrants since the pandemic, especially people moving from NSW and Victoria. As a result, home loans and retail spending have been boosted together with economic activity more generally,” the bank’s report said.
“The interesting question now will be how the rankings settle now that Covid-19 is not exerting the influence it played over 2020-2022.
The CBA said population growth was 30 per cent above the decade average for the year ending June 2022. On an annual basis population growth was 2 per cent, the highest since March 2013.
“The two focal points in coming months are housing and job markets. A solid job market will provide valuable support for the key indicators of housing purchase and retail trade,” it said.
“Also, the re-opening of China will be important for resources and tourism-focussed states.”
The state also did well in employment and in demand for its resources. Its biggest weakness was the construction sector which has seen a wave of company collapses.
It was the first time in the 13-year history of the survey that Queensland has topped the charts. The state has been at or near the bottom in the past because the way the survey was designed to highlight the performance of an economy compared with a decade ago. In a resources dependent state like Queensland, that’s not always a good outcome because of the boom-bust nature of the sector.
Queensland ranked second in retail trade, relative economic growth and housing finance.
“When looking across the annual growth rates of the eight economic indicators, Queensland has annual growth rates that exceeded the national average on five of the eight indicators,” the CBA said.