State Final Demand figures finally growing again in Queensland
The Chamber of Commerce and Industry Queensland (CCIQ) welcomes latest Australian Bureau of Statistics’ State Final Demand data which shows Queensland’s domestic economy is growing again.
CCIQ Director of Advocacy Nick Behrens said the data represented a major milestone for the Queensland economy in recording positive domestic growth.
“The ABS figures confirm that the Queensland economy is beginning to recover with State Final Demand rising by 0.7 per cent in seasonally adjusted terms across the June Quarter,” he said.
“This follows an increase of 0.1 per cent in March, after the ABS revised its published figure, up from 0.0 per cent.
“The growth was largely as a result of both State Government consumption and capital expenditure, but it represented a huge step forward after two and half years of negative growth.
“While this growth is largely underpinned by public gross fixed capital formation, which rose by 6.8 per cent, it is particularly encouraging that private capital expenditure also increased in the quarter and is starting to rebound.
“Significantly, the rise of 0.9 per cent is the first time since September 2013 there has been an increase in private investment for Queensland, relative to the previous quarter.”
Mr Behrens said that compared with March 2016, private investment rose by $138 million, while government investment rose by $268 million in seasonally adjusted terms.
“This positive news will take time to filter down to an improved labour market but it will happen,” he said.
“Indeed, a positive impact on jobs has already occurred with an additional 10,280 FTEs employed in the State Public Service in the 2015-16 financial year. But for the private sector, it will take time.
“The preference is that the lifting come from households and the business community. In the short term, government consumption and capital expenditure has a key role to play, but is not sustainable into the longer term unless the state wishes to have the discussion around tax take.”
Mr Behrens said the 0.7 per cent rise in State Final Demand meant Queensland performed better than the national average in the June Quarter, although household consumption continued to lag behind the rest of Australia.
“At just 0.2 per cent, the rise in household consumption is well below the 10-year average for the state, (0.7 per cent), suggesting that the improved economic conditions are yet to flow through to Queensland households,” he said.
“While we have undoubtedly turned a corner, there is still plenty of room for improvement before us. Queensland’s current performance continues to be below the long term trend and continues to lag behind New South Wales and Victoria.
“It is extremely pleasing news that Queensland’s domestic economy is once again growing – but let’s hold off on popping the champagne corks for the time being.”