Optimism for WA's economic recovery
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There’s reason to be optimistic about the state’s economic recovery in 2021, with a skills shortage looming as a potential challenge.
Speaking at a Business News and Bankwest Curtin Economics Centre lunch today, Treasurer Ben Wyatt said Western Australia's economy had emerged relatively stronger than prior to COVID-19 restrictions.
The State budget, released in October, had included upgraded expectations for the recovery, he said, while flagging the Mid Year Review currently under way could have more positive news.
Gross State Product grew by 1.4 per cent in the 2020 financial year, according to the Australian Bureau of Statistics.
National GDP increased by only 0.3 per cent.
Retail data has been particularly strong in WA, with Mr Wyatt saying he had not expected purchases of some products to hold up as well as they did.
Bankwest Curtin Economic Centre director Alan Duncan said retail sales had been up about 15 per cent in September 2020 compared to the same time in 2019.
Mr Wyatt said the federal government’s JobKeeper payments had been important keeping Western Australians in work.
That was backed up by Bankwest Curtin Economics Centre data, which indicated about 48 per cent of small businesses in WA had made use of JobKeeper subsidies.
Mr Wyatt said the payments had been crucial in keeping unemployment under control.
Data from past downturns showed the year after a shock was the period when long term unemployment problems set in, and JobKeeper would help avoid those challenges, he said.
But Mr Wyatt did acknowledge it had led some employees to be less willing to show up to work.
“When (in April) treasury said we’d have 13 per cent unemployment… I didn’t think come November I’d be talking to the state’s biggest companies about a skills shortage,” he said.
A big lift in infrastructure spending was under way too, he said.
Strong retail spending, and the 50 per cent life in infrastructure funding for the 2021 financial year, would contribute to employment growth, he said.