Sep 06, 2017
Michael Matusik

Investment matters, private expenditure, in particular.  It reflects confidence. Where business invests, economic growth and jobs often follow.  People move to where there is work. 

It is a ‘post-postmodern’ world.  Show me the money!

And our table speaks volumes.

Total private investment

State or territory Total

Fiscal 2017


Fiscal 2017

Five year change
NSW $27.5 billion 24% 9%
Vic $20.6 billion 19% 9%
Qld $23.1 billion 21% -51%
SA $5.0 billion 4% -13%
WA $28.6 billion 25% -52%
Tas $961 million 1% -10%
NT $5.7 billion 5% -26%
ACT $828 million 1% -15%
Australia $112.1 billion 100% -33%

Chain volume measures, original data.

Overall business investment is down by a third – from $167 billion during fiscal 2013 – to some $112 billion last financial year.

The biggest losers have been the resource states – WA, Qld and NT.

The winners are NSW and Victoria.

This stuff has teeth.  It is little wonder that Sydney and Melbourne have enjoyed the lion’s share of recent dwelling appreciation and much of the job growth.  Their wages have lifted too.

Recent analysis by HILDA shows that a typical Australian family, today, earns less than it did in 2009.  The median real disposable household income is about $76,250 today.  It was $77,500 prior to the onset of the GFC.

Two places, however, where real household incomes have increased over recent years have been in Sydney and Melbourne.

To mangle a great line from Hotel California – “many might want to check out, but most cannot leave”.

And on that note, many, including me, like The Eagles.  And one of my favourite movies is the Big Lebowski.  It’s complicated that way.  Anyway, some of their best tunes were co-written by Jack Tempchin and JD Souther.  Both have new records out – Peaceful Easy Feeling and Natural History – for those who would like to hear some classic Eagles and Glenn Frey tunes in their original stripped back ‘demo’ configurations.

PS And looking forward, recent data shows that Australian companies propose capital expenditure of $A101.8 billion in fiscal 2018. This represents an increase of 17.6% on predictions made in June. Whilst the lift is encouraging, it remains well below the long-term average.   More troubling is the lack of company interest in reinvestment, as many companies have ageing assets that need to be replaced.

Keen to hear your thoughts.

Until next time,


Michael Matusik


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