I’m unsure if the Queensland economy is at a standstill, as suggested by the federal Treasurer Joe Hockey (see today’s Courier-Mail report), but, at best, it is moving slowly and sluggishly. This has meant the Queensland unemployment rate has remained stuck above 6 per cent, but so has the national unemployment rate, which is only slightly lower than Queensland’s. The Queensland economy is currently enduring a major shock from the end of the mining boom. As I’ve commented in a previous post, the economy is enduring the shock as well as can be expected.
The economy is currently being propped up by recoveries in residential construction, particularly associated with the boom in approvals and construction of apartment towers (see Qld economy propped up by residential building as business investment slumps), and tourism (see the International Tourism Snapshot). And measures of confidence are improving, particularly in the building industry (see Gold, Sunshine coasts drive construction confidence: Master Builders).
That said, business is legitimately concerned about future levels of infrastructure investment, and is eagerly awaiting the State Government’s draft State Infrastructure Plan, to be released later this year. There is no doubt the business sector was looking forward to the $8 billion of infrastructure spending that was to be funded from privatisation proceeds by the previous government. This funding is no longer available for new infrastructure, so the business community is anxiously awaiting the current Government’s plans to be set out later this year.