More ‘good news’ ahead for SA - ANZ’s Stateometer

“THERE is more good news to come in SA” with the state’s economic activity above trend while the eastern states are decelerating, a new report shows.

“THERE is more good news to come in SA” with the state’s economic activity above trend while the eastern states are decelerating, a new report shows.

The quarterly ANZ Stateometer report, released today, said the trend in SA has been positive for more than a year due to the strong labour market.

SA, ACT and Tasmania were the only states growing at an above-trend rate.

Business and trade activity within the state rose in line with trend in the June quarter with SA also bucking the weaker housing trend demonstrated by the eastern states.

Pedestrians are seen in Rundle Mall in Adelaide, Tuesday, August 7, 2018. AAP Image/Kelly Barnes.

“The positive part for SA is the jobs market with the unemployment rate now at a six-year low,” ANZ senior economist Cherelle Murphy told The Advertiser.

“Anecdotally we know there are lots of jobs going in the health and constructions sectors and there is a build up in anticipation related to the jobs to come due to the future frigates and renewable energy investments,” she said.

However, overall participation rate was lower.

The state’s unemployment rate is expected to fall to 5.5 per cent by June next year, from 5.6 per cent in June this year, she said.

The change in government “seems to have met business approval” the report said.

“Firms were also more confident than those in any other state or territory, in part reflecting a very positive outlook about the forward work schedule and the general outlook for the SA economy,” the Stateometer said.

A concept image of BAE's Type 26 Global Combat Ship (for the Future Frigate program). Picture: Supplied.

Business SA chief executive Nigel McBride welcomed the positive findings, saying the state “is going through something of a purple patch”.

“Clearly the reports, including the ANZ stateometer and our own Survey of Business Expectations, indicate that,” he said.

“That’s important because what we need to do is be above trend to recover across a number of areas where we were lagging. It’s particularly good to see in the jobs space that we’re also doing a lot better.”

The Business SA-William Buck Survey of Business Expectations this week revealed confidence among SA businesses was high, but challenges remained.

“We have ongoing challenges confronting our state’s businesses, led by energy costs and uncertainty around the future,” Mr McBride said.

“In summary, the short to medium term indicators are very good and it’s pleasing to see, but we still face longer-term issues around things like energy, jobs and population growth. We need to see the positivity continue.”

His comments echo findings in BankSA’s latest Trends economic report, released earlier this month, which also earmarked population growth as “essential to SA’s economic wellbeing”.