Advertisement

WA loses crown as top State

Mining is moving from construction to exports.

WA has lost its mantle as the nation's strongest economy.

In a sign of WA's changing economic fortunes, it could be overtaken by a string of other States unless the housing sector remains strong.

CommSec's quarterly assessment of the state of the States shows WA was replaced by NSW as the country's strongest economy on the back of increasing population growth, business investment and unemployment.

It is the first time since the depths of the global financial crisis when the mining sector slowed and shed 20,000 staff that WA has not been Australia's top performed State.

The CommSec research covers a range of key indicators including overall growth, employment, population, investment, wages and housing.

MORE BUSINESS NEWS
AUSDRILL WARNS OF EARNINGS SLUMP
MEDIBANK PRIVATE IPO TO FETCH $5.5b
LONGER LIVES MAY LEAD TO FINANCIAL RISK TAKING
PROTECT MID-WEST IRON ORE: EPA
MICROSOFT PLANS TO LAUNCH SMARTWATCH: FORBES

While WA remains near the top in most areas, it has been edged by a resurgent NSW, which is being buoyed by a resurgent property sector, and the Northern Territory, where the oil and gas sector is extremely strong.

Even Victoria is threatening to edge WA in coming months as its housing sector responds well to low interest rates.

CommSec's chief economist Craig James said though it had lost the number one spot, WA was still in a good position.

"The WA economy remains strong despite the fading of the mining boom," he said.

"Unemployment remains relatively low while housing activity underpins consumer spending on household goods."

But factors that have underpinned WA for more than a decade are losing steam.

The transition of the mining boom into record levels of exports with few new major projects in line to replace the major Gorgon LNG and Roy Hill iron ore mine is cutting into the State's construction pipeline.

Though WA still has the fastest growing population in the country, that growth rate has fallen more than a quarter in the past year. And the retail sector has struggled for most of the year.