Unlikely state crowned best in Australia economically

A surprising state is currently outperforming the rest of Australia financially, taking out the top ranking for the first time in 15 years.

South Australia is outperforming the rest of Australia financially for the first time in 15 years.

The state has hit the top of the economic performance leaderboard in Commonwealth Bank’s quarterly State of the States report — taking the top spot from Victoria.

The report ranks states and territories on eight economic indicators. South Australia took out first place for four of them – real economic growth, unemployment, construction work and dwelling starts.

SA is where it's at for economic activity. Picture: CommSec State of States report.

“For the first time in the history of our reports, South Australia has taken the lead,” CommSec chief economist Craig James said.

“Population growth in South Australia has tripled over the past two years, which is showing up in a strong housing market and overall economic activity.”

Adelaide has been named the coolest city in Australia by the Wall St Journal. Picture: Brett Hartwig

The news comes after the South Australian capital Adelaide took out the unlikely title of Australia’s coolest city, as crowned by the Wall Street Journal last October, a decision that was met by surprise in some quarters.

It seems residents don’t call it Radelaide for nothing, given its booming economy and coolest city plaudit.

South Australians will also be relishing dethroning Victoria from the top spot, given it loves to hate its eastern rival.

Victoria’s economy was ranked equal second with NSW by the report, followed by Western Australia, Tasmania, the ACT and Queensland, with the Northern Territory coming in last.

Economic activity in South Australia was found to be nine per cent above its four-year average in the September quarter, and the state was also found to have the strongest job market in Australia, measured by comparing its unemployment rate with the decade average.

It also came out on top for construction work completed, which was 23.4 per cent above its 10-year average.

It also ranked best for residential building starts – while these were 2.3 per cent below its decade average for the quarter, this decline was smaller than in the other states.

South Australia can’t afford to rest on its laurels. Picture: CommSec State of the States Report.

But Mr James warned South Australia can’t afford to rest on its laurels.

“South Australia can’t rest easily. It is likely the state will face challenges from NSW and Victoria in the period ahead,” he said.

The ACT ranked first for retail spending, Queensland ranked first for home loan applications, Western Australia ranked first for relative population growth and Tasmania ranked first for equipment spending.