The Central Coast economy grew at 4.3% per year over the last two years, well exceeding its regional plan targets for job growth. However, the document notes some downside risks from global and domestic economic trends that could threaten continued growth. It highlights the need for long-term focus and investments like those that transformed Geelong's economy, to further reduce unemployment and commuting by growing jobs in line with residents' needs across the entire Central Coast region.

1. Central Coast –
Economic update
Keenan Jackson
5 April 2019

2. Central Coast in 2017/18
$950m
in building approvals
$13.5B Economy
2.9% growth
126,500 jobs
3.7% growth
5.8% Unemployment
(Sept. 2018)
Sector Jobs
Growth
Last five years
+5,409
+4,497
+801
+767
+746
Health Care and Social…
Construction
Professional, Scientific and…
Administrative and Support…
Information Media and…
0.8% pop growth
(NSW 1.5%)
6.7%
Exports growth

3. -2
-1
0
1
2
3
4
5
201820162014201220102008200620042002
Annual change in GRP (%)
Central Coast Council area New South Wales
Strong economic growth last couple of years
Source: NIEIR, 2018
Recent
years have
exceeded
NSW
average

4. Pipeline still strong for 2018/19
Source: ABS Cat 8731.0 - Building Approvals, Australia, Jan 2019
$682,927
$264,871
0
200,000
400,000
600,000
800,000
1,000,000
Value of Building Approvals
Residential $('000) Non-residential $('000)
On track
for $780m

5. Unemployment rate still above the State’s
Source: ABS Cat 6291.0.55.001 - Labour Force, Australia, Detailed - Electronic Delivery, Aug 2018
5.8
4.8
4.4
4.0
4.5
5.0
5.5
6.0
6.5
7.0
7.5
Sep-11 Sep-12 Sep-13 Sep-14 Sep-15 Sep-16 Sep-17 Sep-18
Unemployment Rate
Central Coast NSW Greater Sydney

6. 2018 saw declining unemployed as labour force
grew
Source: ABS Cat 6291.0.55.001 - Labour Force, Australia, Detailed - Electronic Delivery, Aug 2018
-25%
-20%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
Sep-12
Dec-12
Mar-13
Jun-13
Sep-13
Dec-13
Mar-14
Jun-14
Sep-14
Dec-14
Mar-15
Jun-15
Sep-15
Dec-15
Mar-16
Jun-16
Sep-16
Dec-16
Mar-17
Jun-17
Sep-17
Dec-17
Mar-18
Jun-18
Sep-18
Annual change in number in Labour Force and Unemployed
Unemployed Labour force
Peak
situation -
declining
u/e at the
same time
as rising
labour
force

7. However, job vacancies flattening off
Source: Department of Jobs and Small Business, Internet Vacancy Index (IVI) August 2018
600
700
800
900
1,000
1,100
1,200
1,300
1,400
1,500 May-10
Oct-10
Mar-11
Aug-11
Jan-12
Jun-12
Nov-12
Apr-13
Sep-13
Feb-14
Jul-14
Dec-14
May-15
Oct-15
Mar-16
Aug-16
Jan-17
Jun-17
Nov-17
Apr-18
Sep-18
Feb-19
Internet Job Vacancies, 2010 to 2019

8. Two years in

9. Region Plan – Two years in
‘Goal 1 – A prosperous Central Coast with more jobs close to home’
‘The Plan aims to increase the number of local jobs to reduce the necessity for
workers to commute out of the region.’
Working locally
2011 – 73.2%
2016 – 68.4%
5 year growth to 2016
Jobs – 0.7% p.a.
Employed residents - 0.7%p.a.
Will just increasing jobs, any jobs, achieve this?
Between 30-35,000 residents
travelling 50km or more for work
each day.
By far the largest of any NSW LGA.

10. Great start so far
Top sectors for residents commuting
outside the Central Coast, 2016
In the top 6
local jobs
growth
sectors
last two
years
2 year growth
Jobs –
4.3% p.a.
Employed
residents –
2.6%p.a.
Construction
Health Care and
Social Assistance
Public Admin. and
Safety
Professional,
Scientific and
Technical Services
Retail Trade

11. Well on the way to achieving desired jobs growth
24,674
27,400
31,965 32,039
10,103
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
Regional Plan Req'd to maintain
capacity
2006 to 2016
Growth rate
Req'd to increase
capacity
Last two years
Increase in Jobs to 2036

12. Two years in

13. Well….we know jobs growth doesn’t last forever
-2
-1
0
1
2
3
4
5
6
201820162014201220102008200620042002
Annual change in jobs (%)
Central Coast Council area New South Wales
U/E rate,
especially
youth, still
above
state
average

14. Last two years has been strong for most locations
Greater Geelong (C) 6.3%
Logan (C) 5.8%
Ballarat (C) 5.4%
Moreton Bay (R) 5.3%
Mornington Peninsula (S) 5.2%
Maitland (C) 4.4%
Gold Coast (C) 4.3%
Central Coast (C) (NSW) 4.3%
Sunshine Coast (R) 4.1%
Toowoomba (R) 3.6%
Greater Bendigo (C) 3.3%
Lake Macquarie (C) 2.8%
Newcastle (C) 2.8%
Wollongong (C) 2.1%
Rockingham (C) 2.1%Source: NIEIR, 2019
Average
Annual
growth
GRP,
2015/16 to
2017/18

15. Development overwhelmingly centred on Gosford
Source: ABS Cat 8731.0 - Building Approvals, Australia, Jan 2019
Residential Non-residential

16. Recent accumulation of downside risks
Higher interest rates in the US
Likely changes in US fiscal
policy
Ongoing US-China trade wars
BREXIT
Potential exchange
rate/banking crises in some
emerging markets
Global
Lower residential
development commencements
going forward
Excess supply in the housing
market leading to falling
prices and a reverse wealth
affect
Continued low wage growth
Domestic

17. ‘GDP growth over the year to the September quarter
was weaker than previously anticipated. This partly
reflected weaker-than-expected consumption growth
in the quarter and slower growth in household income.
Consumption growth was also revised lower over
recent years.’
RBA, Statement on Monetary Policy, Feb 2019

18. Locations at risk
% employment in Retail
Trade (especially motor
vehicle sales and other-
store retailing)
% of employment in
recreation and hospitality
House price change
Metrics to check Central Coast
✓
✓
?

19. Potential wealth effects
10.3%
26.4%
9.9%
35.7%
0%
10%
20%
30%
40%
Mortgage Stress Rental Stress
Housing stress, 2016
NSW Central Coast
-2.0%
-1.0%
-4.2%
1.1%
-5%
-4%
-3%
-2%
-1%
0%
1%
2%
Median dwelling
price change 2018
Median dwelling
rental change 2018
Housing costs change, 2018
NSW Central Coast
Source: ABS Census of Population and Housing, 2016; Dept. of Family and Community Services, NSW, 2019

20. However, some factors may sustain economy
RBA has interest in keeping rates low
Strong pipeline of non-residential construction commitments
Strong labour market conditions may lead to pick up in wages growth
Lower AUD exchange rate vs major currencies due to connection to emerging
markets and changing interest rate levels between Australia and other
economies, particularly US – domestic tourism boost
Strong regional plan with focused development for Central Coast – gives
confidence to region and certainty to investors

21. Transforming regional and outer-urban
areas hasn’t been easy

22. Hard to grow jobs greater than resident’s needs
LGA
Local jobs
growth 2006 to
2018
Employed
resident’s
growth Difference
Greater Geelong (C) 2.6% 2.3% 0.3%
Lake Macquarie (C) 1.6% 1.3% 0.3%
Greater Bendigo (C) 2.1% 1.8% 0.3%
Maitland (C) 2.8% 2.6% 0.2%
Toowoomba (R) 1.5% 1.4% 0.1%
Central Coast (C) 1.7% 1.6% 0.1%
Ballarat (C) 2.2% 2.1% 0.1%
Sunshine Coast (R) 2.8% 2.9% -0.1%
Newcastle (C) 1.6% 1.8% -0.2%
Rockingham (C) 3.8% 4.0% -0.2%
Gold Coast (C) 2.6% 2.8% -0.2%
Wollongong (C) 0.9% 1.4% -0.5%
Some
LGAs did
manage
to reduce
jobs
deficit
Source: NIEIR, 2019

23. Case Study: Geelong
A coastal city with a large
residential base of over 200,00
Within a 1-1.5 hour of a major
metropolitan city
An economy with a strong
industrial manufacturing history,
centred around a port, that has
faced ongoing challenges in
recent decades.
Managed to transition its
economy in recent years

24. Strong growth
in business
services, in
contrast to
many
‘regional’
areas
-4% 0% 4%
Electricity, Gas, Water and…
Arts and Recreation Services
Financial and Insurance…
Health Care and Social…
Education and Training
Professional, Scientific…
Public Administration and…
Accommodation and Food…
Rental, Hiring and Real…
Construction
Other Services
Retail Trade
Agriculture, Forestry and…
Transport, Postal and…
Administrative and…
Wholesale Trade
Manufacturing
Average Annual Jobs Growth, 2006 to 2016
Greater Geelong
Central Coast

25. Large
investment
in Geelong’s
CBD
2,836
1,614
1,163
164
0
500
1,000
1,500
2,000
2,500
3,000
Geelong Newcastle Wollongong Gosford
Jobs growth in Metro core, 2011 to
2016

26. Geelong’s development has been aided by substantial public investment
One of the key contributors to the growth in Transition has
required major government investment
The Transport Accident Commission was successfully
relocated to Geelong in 2009 supporting 650 employees in a
purpose-built building;
WorkSafe Victoria started relocating in 2016 and in 2018,
700 employees moved into a brand new $120m A-Grade
Office building.
This investment also helped Geelong secure the
headquarters of the National Disability Insurance Agency
which currently supports 300 jobs and is expected to rise to
over 500 upon completion of a new dedicated office
building.

27. Investment that extends into liveability areas
This investment has also been supported by
infrastructure upgrades with train connections to
Melbourne being improved
the opening of the Geelong Ring Road
major upgrades to the local football stadium
($200m since 2006 - $145m from Federal and
State Governments)
New state of the art library and heritage centre
($45.5m - $25m from Federal and State
Governments)
Upgraded Geelong Performing Arts Centre
($38.5m largely funded by State Government)

28. In summary
Central Coast experiencing a period of growth, well on track to
achieve job targets
But some downside risks
Requires a long term focus and continued push for investments
Gosford focus important, but Wyong/Tuggerah needs to roll on now
Leverage current investment appetite to address systemic issues