BCEC Quarterly Economic Commentary – March 2019
– Fragility lingers for the WA economy –
– Show me the money: Wage growth a key culprit for sluggish household consumption growth –
– Dwelling approvals improve – but all else is not equal in the housing sector –
This Western Australia Quarterly Economic Commentary analyses the most recent data on economic and social indicators for WA, as at Q1 2019.
This quarter we see that falling private sector investment is dragging the WA economy into negative growth territory. The decline in SFD (trend) in the quarter to December 2018 of 0.1% would be worse if not for the protection currently provided by growth in public consumption expenditure and public investment.
Household spending growth remains positive, but is weaker in WA compared to that of other states across the nation. Wage growth has been particularly sluggish nationally now for half a decade, and even more sluggish in WA, impacting on household expenditure. The retail sector is particularly feeling the pinch, with four consecutive quarters of negative growth.
Growth in dwelling units approved for construction is a glimmer of hope for another struggling sector, but we’ll have to wait and see if this results in a better year ahead for the housing and construction industries.