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Tasmania is once again the country’s best performing economy, according to the CommSec State of the States report – a quarterly ranking of economic performance. But NSW is close behind.

A strong job market, and relative strength in home loan demand and dwelling starts has kept Tasmania in the number one spot. But population growth lags other state and territory economies, restraining momentum.

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There is little to separate Tasmania from NSW. South Australia is now in third position, followed by Queensland, Western Australia, Victoria, the ACT and the Northern Territory.

The CommSec State of the States report uses the latest available information to provide an economic snapshot of each state and territory by comparing eight key indicators: economic growth, retail spending, equipment investment, unemployment, construction, population growth, housing finance and dwelling commencements.

This quarter the State of the States report puts extra focus on annual growth rates for the eight indicators to highlight economic momentum.  

CommSec Chief Economist Craig James said Tasmania leads the other states and territories on two of the eight indicators with high dwelling starts and firm equipment investment.

“There is little to separate Tasmania from NSW in terms of economic performance. And NSW has solid momentum on its side, leading the ranking of annual growth rates for the eight indicators.

“In fact Tasmania faces challenges from at least three economies – NSW, as well as South Australia and Queensland. Notably Tasmania ranks eighth on relative population growth – pointing to slower economic activity ahead.

“There are encouraging signs for the Western Australian economy. Western Australia leads other states and territories on annual growth rates for two of the eight indicators. This points to potential to ride up the economic performance rankings over the next few years.”

State and territory highlights

  • Tasmania ranked first on dwelling starts and equipment investment.
  • NSW ranked first on relative unemployment.
  • South Australia ranked first on relative population growth.
  • Queensland ranked first on home loans.
  • Western Australia ranked first on relative economic growth.
  • Victoria ranked first on construction work done.
  • The ACT ranked first on retail spending.
  • The Northern Territory ranked third on relative economic growth.

Annual growth rates

  • Annual changes in economic indicators are useful for measuring economic momentum.
  • NSW has the strongest economic momentum, up from second position in the May 2023 survey. Queensland is now second, up from fourth.
  • In joint third position is Western Australia, up from seventh in the previous survey. Victoria is also joint third alongside South Australia.
  • The ACT is in sixth position ahead of the Northern Territory and Tasmania falls to eighth from fifth recorded in the May 2023 survey.
  • Western Australia leads other states and territories on annual growth rates of two of the eight indicators.
  • NSW, South Australia, Tasmania, the Northern Territory, Queensland and the ACT all lead on one indicator.

Note to editors: interviews with Craig James can be requested via the CBA Media team on (02) 9118 6919 or media@cba.com.au.

About the CommSec State of the States Report

The State of the States report uses the most recent economic data available, however while some data relates to the September quarter (population), other data – such as unemployment – is timelier, covering the month of March.

CommSec, the digital broking arm of Australia’s largest bank, assesses the performance of each state and territory on a quarterly basis using eight key indicators. Those indicators include: economic growth, retail spending, equipment investment, unemployment, construction work done, population growth, housing finance, and dwelling commencements.

Just as the Reserve Bank uses long-term averages to determine the level of "normal" interest rates, CommSec compares the key indicators to decade averages; that is, against "normal" performance. CommSec also compares annual growth rates for eight key indicators for all states and territories, in addition to Australia as a whole, enabling a comparison of economic momentum.

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