Queensland’s under-performing economy was illustrated by March labour force data released by the ABS today. The State’s unemployment rate appears stuck around 6%, while the national unemployment rate continues its steady decline, with the seasonally adjusted national rate falling from 5.8% in February to 5.7% in March (see chart below). In Queensland, the volatile seasonally adjusted unemployment rate rebounded to 6.1% in March from the unbelievable 5.6% in February, while the trend unemployment rate remained stable at 6.0%.
Queensland’s labour force data are difficult to read given the volatility in the underlying seasonally adjusted data, but I think they do confirm my under-performing economy view. While South-East Queensland is doing reasonably well, particularly with strong residential construction activity across the region and the Commonwealth Games’ preparations on the Gold Coast, regional Queensland is suffering profoundly from the adverse impacts of the mining downturn and drought. Combined, these opposing forces are giving us an overall lacklustre, under-performing State economy.
I chatted with Pat Hession this afternoon on Townsville ABC Radio regarding what might be done to help the struggling Townsville economy. I suggested that regional economies have to let go of unviable businesses such as the Nickel Refinery, as we cannot afford to prop up unsustainable businesses. Instead, we should improve our education systems to ensure future workers are competitive in the global economy, invest in productive infrastructure (only if it passes the cost-benefit test, of course), and have growth-promoting tax and regulatory policy settings (e.g. cutting payroll tax and deregulating retail trading hours would be a good start). My comments were consistent with a previous post of mine on regional assistance measures:
Regional rescue packages have a poor record
Regarding today’s jobs data, Pete Faulkner, as usual, has a good post:
Gene the govt at both state and federal level need to ensure Infrastucture spend in regional cities is compounded locally to add value to these projects. If you take the stadium in Townvsille it has the potential to transform the CBD and be a catalyst for a range of projects through out the city area. Funding for this project from State and federal governments should also demand that Townsville City Council relax very restrictive building regulations throughout the CBD and waterfront areas that has lead to many vacant blocks of land throughout the city where projects have been rejected by the council even though they comply with the town plan.
Thanks Glen. Good idea regarding requiring the Council to relax restrictive regulations. Would you know what grounds, justifiable or not, developments are being rejected on?
Gene, the main reason is the councillors simply regard the projects as not fitting in with the local area. The planning department approve them as they comply with the town plan but the councillors simply knock them in the head, no doubt from local voting pressure, this sends the wrong signal to developers who spend a lot of time and money preparing their plans for approval within the rules of the town plan only to have councillors overturn their approval.
The council will also not relax its on site car parking requirements for short term accomodation, hotels and self contained apartments. Most councils relax on site car park requirements for these types of developements due to the fact that many tourists and short stay will not have vehicles, Townsville still require each unit to have on a average 1.6 car parks per unit on site, the highest I am aware of anywhere in Qld.
The waterfront PDA is 63 hectares of land covering both sides of the Ross creek from the back of the civic theatre right through to the port and Casino The stadium is a vital part of the developement but its impact will be lost if other developement doesn’t occur with it. I would like to see the State govt take full control of the planning and developement of the area to ensure the local council doesn’t put obstacles in the way and prevent developement from occurring.
Very useful info, Glen. Many thanks. I will try to post on it soon and reference your comment.