Originally posted 5 June 2023.
It’s been some time since we posted on Practical Economics. Our part-time hobby is sometimes very part time!
In that time, several data releases have occurred that enable us to update our Australian state and territory quarterly Gross State Product (GSP) series.
On 7 September 2022 the Australian Bureau of Statistics (ABS) published the June quarter 2022 Australian National Accounts: National Income, Expenditure and Product (ABS Cat. No. 5206).
On 18 November 2022 the ABS released the 2021/22 Australian National Accounts: State Accounts (ABS Cat No. 5220.0). This enables us to true-up the 2021-22 quarterly estimates to a full annual benchmark series.
On 7 December 2022 the ABS published the September quarter 2022 Australian National Accounts: National Income, Expenditure and Product (ABS Cat. No. 5206).
On 3 March 2023 the ABS published the December quarter 2022 Australian National Accounts: National Income, Expenditure and Product (ABS Cat. No. 5206).
We have a bit of catching up to do, so in this post we’ll finish off 2021/22 and do the first half on 2022/23.
As we’ve discussed previously, the ABS does not publish quarterly state and territory GSP.
The Practical Economics quarterly GSP method involves benchmarking quarterly industry indicators to annual GSP benchmarks. For a full description of the method see here and an improved method in the Technical Paper below.
The data produced by this method are experimental and we always encourage you to read our disclaimers here and here.
Anyway, the Technical Paper can be downloaded using the button at the end of this post. Feel free to use it with appropriate attribution. Be careful because it is only a draft, and feel free to be our quality assurance by contacting us if you see an error in the paper.
So how is economic growth in the Australian States and Territories going? Table 1 shows quarterly GSP growth for the December quarter 2022. All states and territories experienced strong economic growth in the December quarter 2022 and year to the December quarter (December quarter 2022 relative to the December quarter 2021).
Table 1: December Quarter 2022 Practical Economics Gross State Product, Percentage Changes, Chain Volume Data
The rebound from the COVID lockdowns of 2020 and 2021 appears almost complete.
However, state and territory performance, in terms of the output gap, or GSP in the December quarter 2022 relative to what it would have been had the trend from the September quarter 2015 to the December quarter 2019 continued, is mixed.
Table 2 shows the output gap for Australian states and territories in the December quarter. The smaller jurisdictions, particularly the mining regions have bounced back to above trend.
Table 2: Output Gap: Australian States and Territories, December Quarter 2022, Percentage Points, Positive value indicates output below potential
However, the nation’s two largest economies, New South Wales and Victoria, remain below trend. In particular, Victorians are having a tough time of it right now.
The next update to our series will come from the ABS National Income, Expenditure and Product release on 7 June 2023, which will include national industry data for the March quarter 2023.
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