It will surprise many Victorians to learn they live in the best performing economy, but that’s the word according to figures released in the theCommSec State of the States report where for the first time in over a year, Victoria is the country’s number one.
Strong economic activity, solid retail spending and business investment catapulted Victoria from fifth place in the previous survey (July 2023) to the number one spot, with the state also recording its highest population growth in almost seven years.
There is little to separate the top six economies with South Australia now ranked second, up from third, followed by NSW, Queensland, Western Australia, Tasmania, the ACT, and the Northern Territory.
The CommSec State of the States report – a quarterly ranking of economic performance – uses the latest available information to provide an economic snapshot of each state and territory by comparing eight key indicators: economic growth, retail spending, equipment investment, unemployment, construction, population growth, housing finance and dwelling commencements.
The State of the States report also has an extra focus on annual growth rates for the eight indicators to highlight economic momentum. This data highlights the scope for Australia’s economies to lift on the economic performance leaderboard in future surveys.
CommSec Chief Economist Craig James said Victoria improved its ranking on four of the eight indicators.
“Economic activity in Victoria in the June quarter was 7.7% above its four-year average level of output and equipment investment was at record highs as well – up 19.7% on the decade average.
“While the lift from fifth to first is surprising, we knew coming into this quarter there was little to separate the economic performance of the states and territories. We expect Victoria to face challenges from the other economies in the period ahead.
“Looking at the other states and territories, the report also highlighted strong economic momentum from Western Australia as it leads on annual growth rates,” said Mr James.
State and territory highlights
- Victoria ranked first on relative economic growth and construction work.
- South Australia ranked first on relative unemployment.
- Queensland ranked first on home loans.
- Western Australia ranked first in relative population growth.
- Tasmania ranked first on equipment spending and dwelling starts.
- The ACT ranked first in retail spending.
- NSW ranked second or third on four of the eight indicators.
- The Northern Territory ranked fourth on relative population growth.
Annual growth rates
- Annual changes in economic indicators are useful for measuring economic momentum.
- Western Australia has the strongest economic momentum, with NSW, Victoria and Queensland tied for second position.
- South Australia is now fifth, ahead of the ACT in sixth position, followed by the Northern Territory and Tasmania.
- Western Australia leads other states and territories on annual growth rates of three of the eight indicators.
- NSW, South Australia, the Northern Territory, Queensland and the ACT all lead on one indicator.