Cairns and the broader Far North Queensland (FNQ) economy appeared to be in a lot of trouble in the immediate post-financial crisis period, as a result of a large decline in tourism and an over-supply of housing and commercial property which suppressed construction activity. But there is compelling evidence of a solid recovery in FNQ, as discussed in the latest Cairns Watch publication from Rick Carr at Herron Todd White (HTW), Cairns (Hat tip to KS at Loose Change for alerting me to this in his post Cairns Watch Optimistic).
I found the Cairns Watch chart of the ABS estimates of people employed in FNQ very interesting, although I think the trend time series estimated by HTW looks a bit odd. It appears too responsive to the most recent observations. Given regional employment data are highly volatile, I’d prefer a more conservative trend estimate such as a 12-month moving average (see chart below). Regardless of the trend estimate chosen, it appears clear there is a recovery in the FNQ labour market. If the most recent original data are close to the true employment level (i.e. FNQ employment is around 145,000) then employment in FNQ has recovered to at least what you’d expect it to be based on population growth (the hypothetical line below). New ABS data over the next few months will hopefully confirm this employment rebound.
Previous posts of mine on the FNQ economy can be found at this link.