Bye, bye basket-case, as Tassie’s tiger economy untamed by Covid: CommSec

Tasmania’s success in avoiding Covid-19 lockdowns has led to an extraordinary economic performance, well ahead of all other states and territories, according to the latest analysis by CommSec.

Tasmanian Premier Peter Gutwein in Hobart. Picture: Chris Kidd

Tasmania’s success in avoiding Covid-19 lockdowns has led to an extraordinary economic performance, well ahead of all other states and territories, according to the latest analysis by CommSec. 

Its “State of the States” report, released on Monday, concludes all jurisdictions are “performing solidly”, given the frequent lockdowns and border closures.

However, it finds Tasmania has consolidated its “top position” as the standout economic mover, further burying the island state’s former reputation as a basket-case economy.

“In a relative sense, and for the sixth quarter in a row, Tasmania holds the mantle of the best-performing economy,” the report concludes. “Tasmania leads on four of the eight (economic) indicators and is second-ranked on another two.

“The success in suppressing the Covid-19 virus has meant Tasmania hasn’t been forced to lock down its economy to the same extent as other economies, although it has had to close borders.

“There are few signs of Tasmania giving up the position as top-performing economy in the next six months. There is little to separate the other states and territories, although there remains a gap between seventh position and the Northern Territory economy.”

Tasmania has not had a Covid-19 case since December and has avoided lockdowns since last winter. While its propensity to close its borders to parts of or entire states experiencing outbreaks has hurt its tourism sector, the CommSec report suggests the strategy has held significant benefits for the broader economy.

“Tasmania is ranked first on relative population growth, equipment investment, relative unemployment and dwelling starts (and) second on retail trade, and is third-ranked on relative economic growth,” the report says.

 

CommSec measures each jurisdiction against its decadal average in eight key economic indicators, to judge how they are tracking compared with their “normal” performance.

Victoria was ranked second, followed by the ACT, South Australia, NSW, Western Australia, Queensland and the NT. In terms of economic activity, the standouts are WA, ACT and Tasmania, all with growth levels near to or exceeding 20 per cent of their “normal” performance (WA 23.3 per cent; ACT 21.3 and Tasmania 19.3).

The ACT leads retail spending, at 17.6 per cent above decadal average, followed by Tasmania (17.5) and Queensland (15.5).

Underlying the marked improvement in Tasmania’s recent economic performance, investment on new plant and equipment is 52.3 per cent higher than the decadal average, a long way ahead of the next best, NSW on 9.88.

Tasmania has the “strongest job market”, with unemployment at a 12-year low on 4.5 per cent, below the decadal average by 30.8 per cent, the report says. Victoria leads on construction work and home loans.

CommSec said vaccination rates, as well as Covid-19 cases, would “hold the key” to states’ “ reducing both uncertainty and volatility”.

Tasmania claims to be leading the nation in vaccination rates. Premier Peter Gutwein announced on Friday 44.5 per cent of eligible Tasmanians had received their first dose, while 20.4 per cent were fully vaccinated.