State of the States Report Reflects The New Mining Boom
27th April 2021
The Shadow Treasurer Dr Steve Thomas has reinforced the contribution of the state’s resources and construction sectors have made to the positive result in the CommSec State of the States report for April whilst calling for the Government to diversify the state’s economy.
“Western Australia has jumped over all the other states and is only behind the ACT in terms of relative economic growth” Dr Thomas said. “The measure of relative economic growth is now nominal state final demand plus trade, so I am sure the State Government will want to thank the resources sector, especially the iron ore producers, for the great result.”
“The two other areas where WA came in second, dwelling starts and relative unemployment, reflect the high take up of financial support packages for the building industry and the need for labour in key industries like mining and agriculture which are struggling to find workers.”
Dr Thomas said that the figures once again highlighted the reliance of the State Government on the state’s iron ore sector, and the need for a better plan to prepare for the next inevitable correction.
“Once again the Labor Government is reaping the benefit of the boom in iron ore that started in February 2019 and has continued unabated. This boom has entirely paid for the Governments $5.5 billion COVID response and is driving budget surpluses into the future.”
“However, the good times can’t last forever, and we need a proper plan to smooth out the boom and bust nature of the WA economy” Dr Thomas said.
“This is highlighted by the measures of greater concern in this report, especially that of Equipment Investment where WA came in second last with a drop of 7.2%, and Construction Work where we also came in second last with a drop of 43% on the long term average. It is not a good indicator of future economic growth that during a current boom the spend on equipment purchasing and business construction, that would both support the current iron ore boom and diversify our economic growth into other areas, are on the decline.”
“It is time for a plan to stabilise and diversify our economy so that we are not stuck in the boom and bust pattern forever” Dr Thomas said.
Contact: Dr Steve Thomas 0427 908 717