'SA is doing better than many people realise – much better,' report states

By on
Southbank, Victoria, Australia
A recent study found there has been a 42 percent rise in failure rate across the nationwide startup sector. Mike Wilson/Unsplash

Amid some challenges to keep the power alive, South Australia is doing better than several people may have thought. SA’s economy is rising at about its fastest rate for this decade so far, a new report states.

Deloitte Access Economics’ latest business outlook report reveals that the state is “doing better than many people realise, much better,” painting a more positive view of the state. It reveals that SA’s economy, despite challenges such as in energy and car manufacturing, is growing fast.

The relatively rosy picture is based on looking beyond “headline hugging” negative like the closure of Holden’s manufacturing plant. The report says that South Australia is “climbing out of the depths and into the light” following a dip in 2016 when business investment represented only a tenth of its economy.

“In fact, at around 12 percent of the economy, business investment in South Australia is just shy of the Australian average and that hasn’t been true for a long time,” the report adds. The state’s latest survival rate was higher compared to any other Australian state; small business confidence is seeing its best performance since 2013 as well. These lead to the creation of jobs. Full-time employment in SA during the final months of 2017 was beaten out only by the ACT.

The report notes that job growth equates to a drop in underemployment, although total job growth in the State was not as high as in some states. Those who used to work part-time got upgraded to full-time roles as SA also sees its unemployment rate drift downward.

Retail spending is stronger compared to the national average. Major investment in utilities is ongoing, particularly in energy projects. These bring positive impact to the state’s economy, which the report says is growing at about its fastest rate this decade.

Meanwhile, CommSec's State of the States report has ranked SA in the fifth place of the eight states and territories when it comes to economic performance. But there are still challenges that SA is facing, with some likely to get worse. Population loss to other states, flat housing market and impacts from the end of automotive manufacturing are said to be some of these challenges.

Treasurer Tom Koutsantonis has commented on the Deloitte Access Economics report, saying the finding on business confidence was “remarkable.”

“We are starting to see our direct investments in the economy have an impact,” he said, according to the ABC.