South Australia has the equal strongest growing state economy in the country, along with WA, according to today’s State Final Demand (SFD) figures released by the Australian Bureau of Statistics.

South Australia’s SFD increased by 0.9 per cent in the quarter, well above the equivalent national Domestic Final Demand (DFD) figure of 0.2 per cent.

It takes the annual rate of SFD growth in SA to 1.5 per cent, on par with the national DFD growth.

Quarterly growth rates in public and private investment in South Australia were the highest of all states, with public investment growing by 5.8 per cent and private investment up 2.7 per cent.

Household consumption in the quarter fell by 0.3 per cent, as South Australian households tighten their belts in response to the RBA’s rate hikes.

Household consumption makes up 53 per cent of South Australia’s SFD in the June quarter, so slowing household consumption has a large impact on headline economic growth figures.

This pressure on household finances also showed in the national household saving ratio, remaining at 0.6 per cent, well below pre-COVID levels.

Despite slowing household demand, today’s overall result is a positive sign for the South Australian economy and demonstrates how the government’s significant pipeline of work is offsetting some of the loss in economic activity from households pulling back on spending.

Quotes

Attributable to Stephen Mullighan

Today’s results should give South Australians confidence that the state’s economy is well positioned to combat reductions in household spending, as a result of the RBA’s rate rises and cost of living pressures.

South Australia has topped the state leaderboard, along with WA, as having the highest quarterly growth in State Final Demand.

Despite sluggish growth in household consumption as households tighten their belts, public and private investment indicates continued confidence in the South Australian economy.

Strength in private investment follows South Australia being named the best place in the nation to do business, according to the Business Council of Australia.

The massive amount of work in the pipeline should provide ongoing confidence to South Australians heading into an uncertain period.