Central Melbourne economy outpacing Sydney and driving the nation

Melbourne’s economic growth is outpacing Sydney and helping to power the nation, a new report has found.

Melbourne’s economic growth is outpacing Sydney and helping to power the nation, a new report has found. Picture: David Caird

Melbourne’s economic growth is outpacing Sydney and helping to power the nation, a new report has found.

Most of the growth is in central Melbourne but economic bursts also occurred in the Port Phillip and Monash council areas, according to the report Economic Performance of Cities and Regions, by SGS Economics and Planning.

CAFE CULTURE DRIVING CITY ECONOMY

MELBOURNE’S DECADE OF GROWTH

Melbourne’s GDP grew by 4.3 per cent in the last financial year, while Sydney’s economic output slowed to 3.1 per cent, report author Terry Rawnsley said.

The city has now outperformed the Australian economy every year since 2013, averaging annual growth of 3.8 per cent.

Central Melbourne remains one of Australia’s economic powerhouses.

The sectors that contributed most to the latest rise were financial and insurance services, healthcare and construction and professional services.

“Aside from these largest contributors, there was a broad-based growth pattern across the economy of Melbourne,” said Mr Rawnsley.

Melbourne contributed 28.9 per cent to national GDP growth, the largest of any location in Australia.

“While Sydney has slowed, Melbourne’s growth increased during 2017-18,” Mr Rawnsley said.

A City of Melbourne report this year revealed the city annual economy soared to $94.96 billion — up 3 per cent in a year. More than 78,000 jobs had been created in 10 years.

Melbourne’s economic growth is outpacing Sydney and helping to power the nation, a new report has found. Picture: David Caird

The SGS study found that Victoria’s regions were still doing well, despite a not unsurprising small drop from a big year before.

“Regional Victoria had a very small decline in 2017-18 but it had a bumper year in the previous year. There were good rains in 2016-17 and there was more wheat than you could poke a stick at and this year it came off the boil.

“When you look outside that farming production, places like Geelong, Ballarat and Bendigo are still growing.’’

The closure of the Hazelwood Power Station contributed to a 6.7 per cent drop in economic output in the Latrobe Valley.

Nationally, the economic gap between city and country is narrowing, the report said.

“The patchwork economy of strong inner cities in Melbourne and Sydney and weak regional areas looks to be over with growth rates across the country starting to converge.”

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