Post on 20-Aug-2015
transcript
FUTURE PROOFING THE REGION
“Are we there yet?”UPPER HUNTER ECONOMIC UPDATE
Jenny Williams – Senior Research Fellow16 September 2014
FUTURE PROOFING THE REGION
Overview
Upper Hunter Region• A tougher year
– Labour market– Business performance– Consumption and housing
• “Are we there yet?” – Challenges and opportunities– Business and consumer confidence– Continued dependence on mining– Business use of Information and Communications Technology (ICT)– Economic outlook
Context • Global outlook• National economy
FUTURE PROOFING THE REGION
World economySTRONGER
SOURCE: St George Bank
%pa
FUTURE PROOFING THE REGION
0
4
8
12
2008 2009 2010 2011 2012 2013 2014 2015 2016
China GDP (actual & forecasts)
Source: Bloomberg Consensus Forecasts, June 2014
%
Actual
Forecasts
China’s economySTILL STRONG
SOURCE: St George Bank
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Australian economyTRANSITIONING TO NON‐MINING
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Australian economyHOUSING SECTOR DOING THE HEAVY LIFTING
SOURCE: St George Bank
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0.40
0.60
0.80
1.00
1.20
40
60
80
100
120
Mar‐79 Mar‐89 Mar‐99 Mar‐09
AUD & the Terms of Trade
AUD /USD (rhs)
Terms of Trade (lhs)
Federal BudgetForecasts
SOURCE: St George Bank
Commodity prices fallingAUSTRALIAN $ STICKY
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Macro contextMAIN FACTORS
World economy:• Growth in main trading partners• Risks balanced
Australian economy:• Growth in resource exports• Terms of trade weaker but AUD remains high • Housing leading non‐mining investment• Underpinning consumption growth• Labour market to remain soft into 2016
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Upper Hunter labour marketWEAKER
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20
22
24
26
28
30
32
JUN 04 JUN 06 JUN 08 JUN 10 JUN 12 JUN 14
'000
SOURCE: HRF; Department of Employment and Workplace Relations, Small Area Labour Markets
Upper Hunter Upper Hunter Region
Quarterly estimate
UPPER HUNTER REGION EMPLOYMENT NUMBERS
Upper Hunter labour marketWEAKER
FUTURE PROOFING THE REGION
1%
2%
3%
4%
5%
6%
7%
8%
9%
JUN 04 JUN 06 JUN 08 JUN 10 JUN 12 JUN 14
Upper Hunter Region
NSW
SOURCE: HRF; Department of Employment and Workplace Relations, Small Area Labour Markets
Hunter
UNEMPLOYMENT RATE – UPPER HUNTER REGION, HUNTER AND NSW
Upper Hunter labour marketWEAKER
FUTURE PROOFING THE REGION
0
400
800
1200
1600
2000
JUN 04 JUN 06 JUN 08 JUN 10 JUN 12 JUN 14
SOURCE: HRF; Roads and Maritime Service
Upper Hunter – annualised (lhs)
NEW COMMERCIAL VEHICLE REGISTRATIONS
Upper Hunter business investmentWEAKER
FUTURE PROOFING THE REGION
0
20
40
60
80
100
120
0
400
800
1200
1600
2000
JUN 04 JUN 06 JUN 08 JUN 10 JUN 12 JUN 14
SOURCE: HRF; Roads and Maritime Service
Upper Hunter – annualised (lhs)
NSW – annualised (rhs)
‘000
NEW COMMERCIAL VEHICLE REGISTRATIONS
Upper Hunter business investmentLAGGING NSW
Upper Hunter – annualised (lhs)
FUTURE PROOFING THE REGION
Upper Hunter business performanceNEARING BOTTOM OF CYCLE?
FUTURE PROOFING THE REGION
ConsumptionWEAKER, LAGGING
Upper Hunter (lhs)
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ConsumptionSUBDUED 3‐MONTH OUTLOOK
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ConsumptionSUBDUED 3‐MONTH OUTLOOK
0.0
0.1
0.2
0.3
0.4
0.5
JUN 06 JUN 08 JUN 10 JUN 12 JUN 14
SOURCE: HRF household surveys
December June
(-1 = decrease; 0 = neutral; +1 = increase)
UPPER HUNTER HOUSEHOLD SPENDING EXPECTATIONS
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Housing sectorWEAKER, LAGGING
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Upper Hunter challengesDIVERSIFICATION
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Upper Hunter challengesCONTINUING COST PRESSURES
0
50
100
150
200
250
Jul-06 Jul-08 Jul-10 Jul-12 Jul-14SOURCE: Indexmundi
US$/t
THERMAL COAL PRICECOMPARATIVE PRODUCTION COSTS
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Upper Hunter challengesE‐COMMERCE
FUTURE PROOFING THE REGION
Upper Hunter outlookNEARING BOTTOM OF CYCLE?
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Upper Hunter outlookNEARING BOTTOM OF CYCLE?
??
??
FUTURE PROOFING THE REGION
We look forward to working together to creating a thriving Hunter Region for our
generation and those to come. Thank you