Victoria topples New South Wales to become Australia's top performing economy

Adam Trafford/AFL Media/Getty ImagesChanging of the guard.
  • Victoria is now Australia’s top performing economy, according to Commsec’s latest State of the States report.
  • New South Wales held title for the past nine years.
  • The report uses eight key indicators — economic growth, retail spending, business investment, unemployment, construction work, population growth, housing finance and dwelling commencements — to determine a states overall economic performance.

For the first time in nine years, New South Wales is no longer the top performing economy in Australia.

Victoria is, according to Commsec’s quarterly State of the States report released today.

“Strong population growth, underpinning a lift in construction activity, has resulted in Victoria nudging New South Wales out of top spot for economic performance,” said Craig James, Chief Economist at Commsec.

“However there is little to separate the two economies, with the common features being firm population growth, higher home building and stronger job markets.

“While New South Wales has the strongest job market in the nation and is showing good economic growth, a number of housing indicators softened this quarter, including home loans and spending on new plant and equipment.”

This map from Commsec shows the individual rankings of each state and territory, including a brief synopsis of what added to and detracted from economic performance in the latest report.

Commsec

The State of the States report uses eight key indicators — economic growth, retail spending, business investment, unemployment, construction work, population growth, housing finance and dwelling commencements — to determine a states overall economic performance.

It uses annual growth rates for each of these indicators and compares them to the average level seen over the past decade, helping to determine the final rankings.

Commsec says the report aims to gauge how each economy is performing compared to “normal”.

Given the contrasting economic performances across Australia over the past past decade, with initial strength in mining states and weakness in non-mining states reversed in recent years, it helps explain the current underperformance in those states tied to the performance of the mining sector in the latest report.

For those looking for further information, this link has the answers.

NOW WATCH: Money & Markets videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.