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1338.1 - New South Wales in Focus, 2008 (Reissue)  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 17/06/2008  Reissue
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Image: Economic Activity

ECONOMIC ACTIVITY
Economic Activity – Summary Table
Data cubes with detailed statistics available on the Details Page

STATISTICAL HIGHLIGHTS

The NSW economy continues to grow, though at a slower rate than the nation as a whole. There are many factors that impact the movement of the economy. The growth in NSW is a result of increases in industry contribution to income, strong private business investment and the increasing price of labour.

Economic growth

In 2006–07 economic growth in NSW (1.8% to $321.3 billion), as measured by the chain volume estimates (estimates that exclude the direct effects of changes in prices) of Gross State Product (GSP), had the second lowest annual growth amongst all states and territories. GSP growth was also slower than Australian Gross Domestic Product (GDP) growth (3.2% in 2006–07). Since 2000–01, NSW GSP growth has been lower than national GDP growth by between 0.2% and 1.9%, in part due to the resource boom strongly driving Western Australian and Queensland growth while the benefits for NSW have been more limited.

In 2003–04, NSW GSP per capita, as measured by the chain volume estimates of GSP, fell below national GDP per capita, with the difference continuing to widen since. In 2006–07, in chain volume terms NSW GSP per capita was $46,816 compared to the national GDP per capita of $47,954.

Gross State Product and Gross Domestic Product, Chain volume measures(a)(b), NSW

Graph: Gross State Product and Gross Domestic Product, Chain volume measures(a)(b), NSW


Gross State Product per capita, Chain volume measures(a)(b)

Graph: Gross State Product per capita, Chain volume measures(a)(b)



Consumer Price Index and Wage Price Index

The movements in CPI (measure of the prices of various goods and services) and WPI (measure of wages) are measures of economic impact. The CPI for Sydney rose by 2.7% for the year to 2006–07. The fastest growing items within the CPI 'basket' were food (6.3%), education (5.5%) and health (4.7%). Clothing and footwear was the only category to show a decrease (–0.8%).

Consumer Price Index, Percentage change, Sydney2005–06 to 2006–07

Graph: Consumer Price Index, Percentage change, Sydney—2005–06 to 2006–07


Since 2001, when the introduction of the Goods and Service Tax had a one off effect on the CPI, wages have been growing at a faster rate than consumer prices. In 2006–07 the WPI of total hourly rates of pay (excluding bonuses) for NSW rose by 3.8%, while the CPI rose by 2.7%.

Consumer Price Index and Wage Price Index, Percentage change

Graph: Consumer Price Index and Wage Price Index, Percentage change


Private business investment

Between 1990–91 and 2006–07 NSW private business investment increased from 8.0% to 12% as a proportion of chain weighted GSP to reach an annual $39.2 billion in expenditure. During this period, investment in new machinery and equipment was the main driver of private business investment growth.

NSW private business investment declined marginally between 2005–06 and 2006–07 (by $0.8 billion expenditure), differing from the national trend which saw a 7.0% growth in private business investment during the period.

Private business investment(a), Proportion of GSP, NSW

Graph: Private Business Investment(a), Proportion of GSP, NSW



Total Factor Income

In understanding economic growth it is useful to look at the contributions of different industries to growth in income. Total Factor Income (TFI) represents the value added by factors of production such as labour and capital. It is equivalent to gross domestic product less taxes plus subsidies on production and imports.

In the four years to 2006–07 the total factor income of NSW industries grew in current prices by just over 25% to $300 billion. Mining continued to have the highest annual compound growth, however, it accounted for only a small contribution (2.7%) to total factor income in NSW in 2006–07. Agriculture, forestry and fishing decreased to $3.9 billion in income (1.3% of TFI in 2006–07). The fall in contribution by Agriculture, forestry and fishing is recognised as the effects of the recent drought.

In 2006–07 the largest industry contributors to total factor income were Property and business services (16%) and Manufacturing (11%).

Total Factor Income, By industry(a), Current prices, NSW2002–03 to 2006–07

Graph: Total Factor Income, By industry(a), Current prices, NSW—2002–03 to 2006–07


Contribution to Total Factor Income(a), By industry, Current prices, NSW2006–07

Graph: Contribution to Total Factor Income(a), By industry, Current prices, NSW—2006–07


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International merchandise trade

Both imports and exports of merchandise in NSW have increased by nearly 50% in current terms since 1999–00. Imports in NSW accounted for 39% of total Australian imports with a total value of nearly $70 billion while exports in NSW accounted for 17% of total Australian exports with a total value of just over $28 billion.

From 2005–06 to 2006–07 the value of the NSW international trade deficit increased by 9.7% ($3.7 billion) to $41.7 billion. The increase was the result of imports growth (7.6% or $4.9 billion) exceeding exports growth (4.6% or $1.2 billion).

International merchandise trade, NSW

Graph: International Merchandise Trade, NSW



Economic Activity – Summary Table
Data cubes with detailed statistics available on the Details Page


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