FRASER PREDICTS AN ECONOMIC ROLLERCOASTER

Written on the 4 March 2011

FRASER PREDICTS AN ECONOMIC ROLLERCOASTER

STATE Treasurer Andrew Fraser (pictured) says Queensland businesses are ‘about to go on an economic rollercoaster’.

January’s natural disasters dropped Queensland’s economic growth rate from 3.75 per cent down to about 1 per cent, but the Treasurer says after a severe dip the economy is going ‘to take off and soar’.

“The growth rate for next financial year looks like being 5 – 5.25 per cent. So we’re going to go from one per cent this financial year which is nothing to write home about, to the sort of rate we saw many years ago,” says Fraser.

“We’re going to see swings and roundabouts; a ten-speed economy across Queensland and different speeds within different parts of the region.

“We need to understand that the tourism demand equation, because of the rising Aussie dollar is going to be a continuing challenge. The challenges for tourism are there but I think other parts of Queensland will see a much better 12 months.”

As demand for tradesmen skills heats up Fraser is expecting stronger growth and a potential skills shortage towards the end of 2011.

“It’s going to be the year of the ‘tradie’. If you’re thinking of renovating your house right now I’d say you’re mad, but if your 17 year old son if looking at getting into plastering, building or any other trade they’ll likely retire early,” he says.

“At the start of the year the discussion is going to be about businesses constraining and about job losses in key sectors as a result of the floods.

“But by the end of the year we’re going to be in a position where the discussion will about skills shortages and a tighter labour market. It’s important to emphasise that that’s the type of trajectory that we’ll see.

“There’s a lot of lofting activity that will flow through and that’s really going to require businesses to know and understand that sort of operating environment.

“The sort of challenges that we all know around skills, about the value of retaining skills and the value of ensuring that you’ve got a business plan that will take into account the broader dynamic.

“It’s going to provide a sustained loss to the Queensland economy in the nearer term, but accelerate beyond toward the back end of this year.”


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