Half yearly review of the Hunter economy including local and national insights. Presented at our July 2018 business breakfast in Newcastle.

1. Presented by Dr Anthea Bill
Hunter Research Foundation Centre
27 July 2018
HUNTER ECONOMIC
INDICATORS

2. • Macro: sustained recovery?
• Local: positive but softening
• Housing market trends
• Investment pipeline
PRESENTATION
OUTLINE

3. GDP GROWTH: EXPORT LED
-3.0
-2.0
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
-1.0
-0.6
-0.2
0.2
0.6
1.0
1.4
1.8
2006 2008 2010 2012 2014 2016 2018
% Change Quarterly % Change Annual
GDP % Change, quarterly
GDP % Change, annual
Source: ABS, Seasonally Adjusted Chain Volume Measure.

4. INFRASTRUCTURE SPEND
Source: ABS, Engineering Construction Activity, Australia,
* Chain volume measures
0
5
10
15
20
25
30
1986
1989
1992
1995
1998
2001
2004
2007
2010
2013
2016
Private sector for
the private sector
Private sector for
the public sector
Volume Of Engineering Work Done*
$ Billions
Source: RBA, Chart Pack July 2018.

5. International -
growth picks
up pace;
peak of cycle?
Household sector -
spending subdued
over longer-term
China -
growth steady,
exports ease
OTHER MACRO TRENDS

6. JUNE 2018
HUNTER REGION
ECONOMY

7. 3,000
3,200
3,400
3,600
3,800
4,000
220
240
260
280
300
320
340
2005 2007 2009 2011 2013 2015 2017
'000'000
SOURCE: Australian Bureau of Statistics, Monthly Labour Force Survey
Recovery
LABOUR MARKET: GROWTH SLOWS
Mining CAPEX
Hunter (LHS)
NSW (RHS)

8. WHO IS GROWING 2017-18?
0 2,000 4,000 6,000 8,000
Construction
Education and Training
Rental, Hiring and Real Estate Services
Other Services
Professional, Scientific and Technical Services
Retail Trade
Mining
Manufacturing
Health Care and Social Assistance
-6,000 -4,000 -2,000 0
Accommodation and Food
Services
Arts and Recreation
Services
Public Administration and
Safety
Agriculture, Forestry and
Fishing
Information Media and
Telecommunications
Wholesale Trade
Electricity, Gas, Water and
Waste Services
Financial and Insurance
Services
Transport, Postal and
Warehousing
Administrative and Support
Services
Source: ABS, Labour Force Survey, Change May 2017-May 2018. 4 quarter moving average.

9. UNEMPLOYMENT RATE

10. HOUSING PRICES: SLOWING NOT FALLING

11. APPROVALS: HISTORIC HIGHS
0
10,000
20,000
30,000
40,000
50,000
0
500
1,000
1,500
2,000
2,500
3,000
3,500
MAR 08 MAR 10 MAR 12 MAR 14 MAR 16 MAR 18
HUNTER
0
500
1,000
1,500
2,000
2,500
3,000
3,500
0
10,000
20,000
30,000
40,000
50,000
MAR 08 MAR 10 MAR 12 MAR 14 MAR 16 MAR 18
NSW
HUNTER
Source: ABS, Building Approvals.
New Houses Other (town houses, apartments etc)
NSW

12. BUILDING APPROVALS:
HIGHER DENSITY
0
200
400
600
800
1,000
1,200
1,400
MAR 03 MAR 06 MAR 09 MAR 12 MAR 15 MAR 18
New Houses
Other
Source: ABS, Building Approvals.
Newcastle LGA
0
200
400
600
800
1,000
1,200
MAR 03 MAR 06 MAR 09 MAR 12 MAR 15 MAR 18
New Houses
Other
Lake Macquarie LGA

13. PULSE SURVEYS
Phone
surveys
300
Households
300
Businesses

14. BUSINESS PERFORMANCE:
DOWNWARD CORRECTION
* Figure has been interpolated for June 2015

15. CONSUMER SPENDING: SLUGGISH

16. CONSUMER SPENDING:
HAND-BRAKE
0.0
0.1
0.2
0.3
0.4
0.5
DEC 00 DEC 04 DEC 08 DEC 12 DEC 16
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
Mar-00 Mar-04 Mar-08 Mar-12 Mar-16
%
Pre-GFC
Source: ABS, National Accounts Source: HRF Centre, Household Pulse.
Australia Hunter
Index
Post-GFC
Pre-GFC
Post-GFC

17. REGIONAL OUTLOOK:
MODERATING

18. SUMMARY
• Business confidence and performance
• Consumer spending and confidence
• Regional outlook for households and businesses
• Full-time jobs growth
• Unemployment & participation rate
• New housing approvals, esp. apartments
• Moderate house price growth,
driven by Newcastle LGA

19. THANK YOU
Hunter Region Economic Indicators - June 2018
Available as you leave today