Market Commentary by Brian Briscoe
What an interesting year 2011 has been from a WA perspective. The talk of "two speed" is ever–present and holds true on so many levels; Europe hanging on to its economic life by a string while Australia seems solid; the Eastern states of Australia doing it tough while the resource states see a bright future; West Australians either very busy (if linked to resources / energy) or concerned about being left behind. Hopefully, as much as is pragmatically possible, 2012 won’t see a widening of the “Have’s” and “Have Not’s” and the volatility in business confidence will settle somewhat. Below are a few industry / statistical observations:
Seek Employment Index has reported Western Australia seeing a job ad growth of 9.4% for July and August pass the previous peak seen pre-GFC; a healthy indicator that we are continuing to benefit from growth in the mining and resources sector.
Project Demand
Western Australia continues to align its reputation as a global player in the minerals and energy sectors with the current value of major resources and industrial projects, both committed or under active consideration in Western Australia, at more than $170 billion. This will continue to strengthen as companies invest in growing the industry even further.
It has been forecast that the annual investment is forecast to rise to A$62 billion in 2013 to 2014. Local businesses are benefiting from Western Australia’s relative isolation in competing for contracts and leading global companies are also finding it attractive to locate operations or establish partnerships in Western Australia. As a result of the developing mining technology and services sector a study by the Australian Bureau of Agricultural and Resources Economics and Science identified that Western Australia holds almost a third of the national total with 320 companies located in the state.
Western Australia saw a growth in population partly driven by the increases in net overseas migration of 90.5%. Australia received a net inflow of 57,834 migrants from overseas during the quarter.
Unemployment
Nationally, Australia's unemployment rate has been reported to have increased to 5.2% in September 2011. Western Australia’s unemployment rate is reported to have decreased over three months between August to October to 4.2%.
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