Western Australian state final demand has fallen to its lowest level since the June quarter of 2011, measured in seasonally adjusted terms, down 4.6 per cent in the 2016 financial year.
The latest numbers from the Australian Bureau of Statistics show final demand slumping from March to June by about 2.6 per cent, to $49.6 billion.
That FY2016 number is significantly worse than the already pessimistic state budget forecast from May this year, when the estimated drop was picked to be about 4.3 per cent.
State final demand has contracted more than 13 per cent since its $57.1 billion peak in September 2012.
In the 2015 year it contracted 3.4 per cent, although the 2016 fall is the worst on record.
The drop off in private capital investment was the principal driver of the recent fall in state final demand, down from $77 billion in 2015 to $65 billion in 2016.
Private capital investment peaked in 2013 at more than $92 billion.
In a rare spot of good news, the latest ABS figures show that household consumption had its strongest quarter on record, at $25.2 billion.
Spending on food and health were the two sectors performing best in June.
Bigger picture
Importantly, state final demand is only a partial health check on the state’s economy, because it excludes exports and imports, a particularly major exclusion for WA, which is so engaged in international trade.
With trade included, the picture improves a little.
WA merchandise exports for the June quarter were $25 billion, according to data released last month by the ABS.
That was an increase of 6.4 per cent on the same period in 2015.
Record run
Nationally, Australia completed its 25th consecutive year without a recession, with the economy 3.3 per cent larger in seasonally adjusted terms at the end of the 2016 financial year than at the start.
Gross domestic product for the year to June was just less than $1.67 trillion, meaning the economy is eight times bigger than at the end of the 1991 recession in nominal terms.
Commsec chief economist Craig James said there was much to celebrate about the national economic performance.
“Australia has now notched up 100 quarters without a recession,” he said.
“Netherlands holds the record for the longest expansion, at 103 quarters.
“Over the next year Australia, should pick up the gold medal for the longest economic expansion of a developed economy.
“Economic growth is the fastest in four years and above long-term averages.
“Inflation stands at 1.0 per cent, interest rates stand at 1.5 per cent, unemployment stands at 5.7 per cent.
“The mining construction boom may be over, but it has been replaced by a housing construction boom.”
Mr James highlighted a few other key data points.
Productivity rose by 2.9 per cent over the year, he said, including a 1.5 per cent increase in the June quarter.
Gross national income was 2.5 per cent higher in real terms.
