CommSec report: Tasmania retains top spot in latest economic rankings, but challenges ahead

While the latest CommSec report shows Tasmania is still the top performing economy in the country – it points to challenges ahead. Why Labor says the report is a harbinger of hard times to come.

Labor's Dean Winter said Tasmania was on “the verge of a recession”.

Tasmania is still number one in Australia on economic performance in the latest CommSec report – but it has the poorest population growth pointing to slower economic activity ahead.

The State of the States report shows Tasmania has retained top spot improving its ranking in retail spending and ranking first on equipment spending and dwelling starts.

But like last week’s Deloitte Access Economics Business outlook, which predicts Tasmania will be the only state economy in the nation to go backwards in 2023-24, CommSec also warns of challenges ahead.

CommSec chief economist Craig James said all economies were slowing in response to higher borrowing costs and price pressures.

“While Tasmania remains in first position, it faces challenges from NSW,” he said.

“And while Tasmania leads on two indicators, it ranks eighth on relative population growth — pointing to slower economic activity ahead.”

CommSec chief economist Craig James.

In the rankings, NSW remains in second position and has narrowed the gap with Tasmania, while South Australia is third.

Queensland is in fourth spot, Western Australia fifth while Victoria has slipped to sixth with the ACT ranked seventh ahead of the Northern Territory.

Premier Jeremy Rockliff and Treasurer Michael Ferguson pounced on the CommSec report as evidence their plan for the state’s economy is working.

But Labor’s economic spokesperson Dean Winter said the report confirmed Tasmania had “the slowest growth” of any state or territory.

Mr Rockliff said Tasmania had been ranked first overall for 12 of the previous 14 quarterly reports and improved on all eight performance indicators since coming to government in 2014.

“This is fantastic news for our state and once again confirms that because of our long term plan, our economy is strong and robust, to the benefit of all Tasmanians,” he said.

Premier Jeremy Rockliff. Picture: Nikki Davis-Jones

“Tasmania continues to lead the nation on dwelling commencements as well as on equipment investment, up 23.9 per cent on the decade average, ahead of NSW (up 13.5 per cent).

“We also have the equal highest wage growth in the nation, as well as the second highest performance on unemployment and housing finance.”

But Mr Rockliff said Tasmania was “not immune from the global and national economic headwinds”.

Mr Ferguson, said building and protecting a strong economy in difficult headwinds was the government’s aim.

“Having a strong economy allows us to invest more into the things that matter most to Tasmanians – health, education, housing and community infrastructure,” he said.

Mr Winter said Tasmania was “on the verge of a recession”.

Originally published as CommSec report: Tasmania retains top spot in latest economic rankings, but challenges ahead