One of the perennial topics of discussion in Western Australia is 'life beyond the boom'.
One of the perennial topics of discussion in Western Australia is 'life beyond the boom'. I think we should focus instead on 'life with a prolonged boom', a scenario that warrants a very different policy response.
This view may seem surprising in light of the weak economic data that has been released over the past month.
Housing finance and residential construction activity are weak, housing prices in Perth have fallen, retail sales have slumped, consumer confidence (nationally) has plummeted to its lowest level in 16 years , and the stockmarket has been weak for the past year.
Rising interest rates and oil prices, and not forgetting the current gas crisis, have added to the cocktail of negative news.
There has even been some bad news in the mining sector, which is supposed to be revelling in the boom.
The boom has proved illusory for more than half a dozen gold miners, which have been squeezed by rapidly rising labour and material costs and the much stronger Australian dollar.
Monarch Gold Mining Company's fall into administration last week was the latest in a run of bad news for the gold sector, where several companies have been forced to cut staff numbers, close projects or cancel planned deals.
Outweighing all of these negatives is the extraordinary strength of business and public sector investment in resources and infrastructure projects in Western Australia.
Within the resources sector, two segments are becoming increasingly important to the state's future: iron ore and petroleum.
Iron ore has, to date, been the biggest contributor to the resources boom and will continue to be a huge driver of state growth.
BHP Billiton, Rio Tinto and Fortescue Metals Group collectively have invested some $15 billion in recent years expanding or establishing new operations and are planning to spend just as much in future years.
They will be joined by the likes of China's CP Mining, China's Sinosteel (following its recent acquisition of a majority stake in Midwest Corporation), and probably local companies like Murchison Metals, Australasian Resources, Aquila Resources and Aurox Resources as big investors.
With new projects underway in sectors as diverse as alumina, nickel, molybdenum and even gold, the mining sector is set for continuing rapid expansion.
The mooted expansion projects are designed to bring supply up to speed with demand.
Some Pollyannas are anticipating the day when the supply-demand equation is reversed.
That will happen at some point, but only when WA has a much larger and more diverse mining sector that will support a whole raft of service industries.
Even more extraordinary than the growth in mining investment is the potential in the petroleum sector, especially for liquefied natural gas (LNG) projects in the north of the state.
The Woodside-operated North West Shelf venture is Australia's biggest resources project, with a total investment of $25 billion over the past decade.
Woodside is currently spending a further $12 billion on its wholly-owned Pluto LNG project and is investigating a series of follow-up projects.
Chevron is moving closer to a final commitment to the Gorgon LNG project, which could involve total spending of about $20 billion.
Other groups investigating multi-billion dollar LNG project investments include Shell, Japan's Inpex and BHP Billiton.
There is no guarantee all of these projects will proceed, or that they will be developed in WA.
Nonetheless, with global LNG demand projected to grow rapidly, helped by high oil prices and the push for cleaner energy, it is safe to assume WA's economy will be bolstered by a succession of mammoth LNG projects.
This prospect is luring many international companies to Perth from places like Aberdeen and Houston.
The scale of the proposed LNG projects, and their draw on skilled labour, means that all businesses in WA will be affected.
Talk to anybody trying to service the mining and petroleum sectors, and their number one problem continues to be their limited ability to meet demand.
Accountants, engineers, geologists, almost any profession you care to name, are battling to find the people they need.
A critical challenge for government is to tackle the supply constraints that are holding back the state's growth.
This has many dimensions: from the supply of skilled labour to the availability of land - for residential, industrial and other purposes - to the development of broadband internet services.
The current boom has already run for at least four years (some would suggest five years) and we need to plan for its continuation.
