The West Australian
There’s resilience at heart of WA’s boom
The word boom is often followed by the use of the word bust. Historically the two words have been used in conjunction to describe the WA economy.
So entrenched is the impression created that a bust follows a boom, that while it may not necessarily be a self-fulfilling prophecy, it can certainly be debilitating on business and consumer confidence — and thereby an economic drag.
In some ways perhaps it can be said that the impact of the lean years which followed the end of the last mining boom has scarred WA’s psyche.
This has manifested itself in a certain reluctance to call the current economic revival in this State a boom.
It is almost as if economists or politicians fear that they might jinx things or overcook their assessment if they call it a boom.
And of course there is no compulsion to use the word.
But nevertheless there is no doubt that things are looking up in this State.
As Treasurer Josh Frydenberg — who will address a Leadership Matters breakfast with The West Australian this morning — notes, the WA economy continues to recover strongly from the COVID-19 pandemic with robust mining sector activity, strong household spending, and a buoyant housing market driving the unemployment rate down to 4.8 per cent last month — the lowest in the country.
He says in WA there have been 123,400 new jobs created since May — which is 28,100 more people employed compared with March last year.
This State’s contribution to the national economy is phenomenal, super-charged by Australian iron ore exports, of which WA accounts for 99 per cent.
Australia’s iron ore exports are forecast to reach about 892.5 million tonnes in 2020–21, to reach a total value of around $136.3 billion.
This time around there is a resilience to the economy.
As Mr Frydenberg says: “The WA economy has demonstrated its remarkable resilience, bouncing back strongly from its COVID-19 induced fall and has now fully recovered.
“At nearly $500 million, Western Australia is leading the country in Homebuilder grant applications and is expected to support $4.5 billion in residential construction activity and create jobs.
“The successful HomeBuilder program has been a key part of the Morrison Government’s national economic recovery plan and is seeing the private sector lead the recovery as it takes advantage of the Government’s tax cuts, business investment incentives and record levels of investment in skills, training and infrastructure.
“With WA’s construction, mining and agriculture sectors shining, the outlook for the WA economy is bright,” Mr Frydenberg says. As the nation’s Treasurer, he would know.
We reckon it’s OK to call it a boom.