Economic Performance of Australia’s Cities and Regions draws on research by SGS and data from the annual Australian Bureau of Statistics (ABS) Australian National Accounts: State Accounts (Cat. No. 5220.0). The Australian Bureau of Statistics (ABS) Australian National Accounts: State Accounts (Cat. No. 5220.0) publication provides estimates of economic activity for each state and territory on an annual basis. Since the last release of Economic Performance of Australia’s Cities and Regions in December 2018, the Australian Bureau of Statistics (ABS) has issued a new set of National and State Accounts (Cat. No. 5220.0). The ABS data contains a set of historical revisions, where the annual data is revised through the time series back to 1989-90.

Economic development is measured in terms of income and employment as well as improvements in education, health, culture, community wellbeing and the environment. Our research methodology recognises that economic development is a continuous process of growing an area's level of income and capital and how this income and capital are distributed among the community

This report estimates of economic activity for each major capital city along with the regional balance of each state. These statistics provide improved insights into the relative economic performance of each of Australia’s major capital cities Sydney, Melbourne, Brisbane, Adelaide and Perth, and the regional balance of each state, the Northern Territory, Tasmania and the Australian Capital Territory. Detailed Statistical Area 32 data provides a more comprehensive understanding of the economic performance at the small area level. Importantly, these statistics highlight the challenges facing Australia’s cities and regions. This year’s publication does not include a productivity analysis; we will release this analysis in a separate report in 2020.

Key findings:

During the early 1980s, the economic structure of Australia was reasonably homogeneous. Examining economic statistics at the national level would have provided reasonable insight into the conditions across Australia.

Since this time, the Australian economy has evolved and become complex. The rise of knowledge-intensive services, differentials in government policy and investment, the resources construction boom and bust, the declining competitiveness of manufacturing and other changes have created a fragmented economy.

• The recent drought is impacting many rural economies. Falling agriculture production is directly affecting related industries such as manufacturing, wholesale trade, and transport and storage.
• The perennial underperforming economies of Adelaide and Tasmania have boomed over the past two to three years.
• The decline in the housing sector (in terms of construction and the wealth effect) has impacted some regions more than others. The local economies of residential growth corridors in South East Queensland, Sydney and Perth appear affected by the decline in the housing sector. However, the growth corridors in Melbourne look to have shrugged off the worst of the impacts.
• After growing in unison for much of the past five years, Sydney and Melbourne diverged in 2018-19. Sydney’s GDP growth in 2018-19 has fallen below its ten-year average while Melbourne’s growth continues to be well above the ten-year average. Despite this divergence, Sydney and Melbourne remain the drivers of the national economy. These two cities produced almost 75 per cent of national GDP growth.