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The ACT and Its Region: Economic Relationships and Key Drivers of Economic Growth

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The ACT and Its Region: Economic Relationships and Key Drivers of Economic Growth 2008 The ACT and its region: economic relationships and key drivers of economic growth Report by Access Economics Pty Limited for the Chief Minister‟s Department The ACT and its region CONTENTS Summary ................................................................................................................................ i ACT catchment maps ........................................................................................................ xiii 1. Catchment and linkages ............................................................................................. 1 1.1 Defining the catchment ........................................................................................................ 1 1.2 Current population structure of the traditional catchment .................................................... 2 1.3 Current economic structure of the traditional catchment ..................................................... 4 1.4 ACT demographic projections ............................................................................................12 1.5 The ACT‟s population linkages ..........................................................................................18 1.6 Relative size .......................................................................................................................24 1.7 ACT catchment and linkages .............................................................................................28 1.8 Service population .............................................................................................................30 2. Economic activity and outlook ................................................................................. 34 2.1 The global context – implications for the ACT ...................................................................34 2.2 National context – implications for the ACT .......................................................................36 2.3 Intergenerational implications for the ACT .........................................................................38 2.4 Current structure of the ACT economy ..............................................................................39 2.5 How has the ACT economy been performing? ..................................................................45 2.6 Has growth in the ACT economy peaked? ........................................................................50 2.7 Forecast performance of the ACT economy ......................................................................52 2.8 Investment projects ............................................................................................................54 3. Industries and infrastructure .................................................................................... 58 3.1 Industries ............................................................................................................................58 3.2 Infrastructure ......................................................................................................................65 3.3 Transport ............................................................................................................................69 3.4 Canberra Airport.................................................................................................................74 3.5 Utilities ................................................................................................................................75 3.6 Sport and recreation ..........................................................................................................80 4. SWOT analysis .......................................................................................................... 83 4.1 Strengths ............................................................................................................................83 4.2 Weaknesses .......................................................................................................................84 4.3 Opportunities ......................................................................................................................84 4.4 Threats ...............................................................................................................................85 5. References ................................................................................................................. 88 Appendix A: ACT catchment and linkages ....................................................................... 90 Appendix B: Forecasting methodology .......................................................................... 112 Appendix C: Economic outlook detail ............................................................................ 122 Appendix D: Industry and infrastructure details ............................................................ 123 While every effort has been made to ensure the accuracy of this document, the uncertain nature of economic data, forecasting and analysis means that Access Economics Pty Limited is unable to make any warranties in relation to the information contained herein. Access Economics Pty Limited, its employees and agents disclaim liability for any loss or damage which may arise as a consequence of any person relying on the information contained in this document. The ACT and its region Appendix E: Council of Australian Governments (COAG) reform process.................. 126 FIGURES Figure 1.1: The Australian Capital Region 2 Figure 1.2: Population in the ACR 3 Figure 1.3: Employment in the ACR 3 Figure 1.4: Employment to population ratios in the ACR 4 Figure 1.5: SE NSW employment compared to the national industry make-up 5 Figure 1.6: Employment in Agriculture, Forestry and Fishing in SE NSW over time 6 Figure 1.7: SE NSW employment compared to the ACT industry make-up 8 Figure 1.8: Relative importance of the ACR to the ACT 9 Figure 1.9: Relative importance of the rest of Australia to the ACT 11 Figure 1.10: Population growth rate forecasts 12 Figure 1.11: Components of population growth in Australia 13 Figure 1.12: Components of natural increase in Australia 14 Figure 1.13: Components of population growth in the ACT 14 Figure 1.14: Components of natural increase in the ACT 15 Figure 1.15: Population pyramid for the ACT 17 Figure 1.16: Median age projections (ACT and Australia) 17 Figure 1.17: Population pyramid for the ACT and its surrounding region 18 Figure 1.18: Interstate movement rates (2006) 18 Figure 1.19: Share of the population outside the ACT moving to the ACT 19 Figure 1.20: Share of the population inside the ACT moving interstate 20 Figure 1.21: Net population movements to the ACT (2001-06) 21 Figure 1.22: Population outflow from the ACT (2001-06) 22 Figure 1.23: Absolute population flows from NSW to the ACT (2001-06) 23 Figure 1.24: Relative inflows from NSW (2001-06) 24 Figure 1.25: ACR employment as a ratio to ACT employment 25 Figure 2.1: Corporate tax collections as a share of GDP over time 34 Figure 2.2: Federal tax revenue per person in today‟s dollars (including GST) 35 Figure 2.3: Federal spending per person in today‟s dollars 36 Figure 2.4: The ACT economy – industry shares % of output volumes 40 Figure 2.5: The ACT economy – industry shares % of total employment 41 Figure 2.6: Average industry volume growth, 2000-2007 42 Figure 2.7: ACT employment compared to the national industry make-up 43 Figure 2.8: Gross state product per capita 45 Figure 2.9: Household Gross disposable income per capita, $ 46 The ACT and its region Figure 2.10: The Government sector is still relatively important 47 Figure 2.11: The ACT is also receiving an increasing share of Public Service jobs 48 Figure 2.12: Commercial construction as a share of the ACT economy 49 Figure 2.13: The components of ACT population growth 50 Figure 2.14: ACT shares of output and population 51 Figure 2.15: ACT output and demand growth 53 Figure 2.16: ACT – Stacked employment growth by sector 54 Figure 2.17: Value of ACT non-residential building approvals 55 Figure 2.18: Share of ACT investment projects (where $ values are available) 57 Figure 3.1: Water catchment of the ACT and region 76 Figure 3.2: Water consumption in ACT and region, 2002-03 to 2006-07, GL „000 77 Figure 3.3: Participation of Sporting Teams in ACT Competitions, per Capita 81 Figure B.1: Total and completed fertility rates 114 Figure B.2: Mortality profiles over time 116 Figure B.3: Age profile of interstate population movements for Qld and SA 117 Figure B.4: Population inflow 119 Figure B.5: Population outflow from South Australia (absolute) 121 Figure B.6: Population outflow from South Australia (logit) 121 Figure D.1: Greater Southern Area Health Service Boundaries and Services 125 The ACT and its region TABLES Table 1-1: Summary of assumptions 16 Table 1-2: Journey to work into the ACT, 2006 27 Table 1-3: Journey to work out of the ACT, 2006 27 Table 1-4: Australia 28 Table 1-5: Canberra 29 Table 1-6: The Australian Capital Region 30 Table 1-7: Service population estimates 32 Table 2-1: Estimates of volatility 49 Table 2-2: Specific sector employment forecasts 54 Table 2-3: Summary of ACT investment projects (where $ values are available) 56 Table 3-1: Employment by industry, ACT 2006 58 Table 3-2: Employment by industry, Queanbeyan 2006 59 Table 3-3: Employment by industry, ACR 2006 60 Table 3-4: Overnight Cross-Border Tourism, Visitor Nights („000) 2006-07 61 Table 3-5: Day Trip Cross-Border Tourism, Persons („000) 2006-07 62 Table 3-6: Attendees,
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