There comes a time in the rhythm of Perth’s life when everything seems bad. There is no good news or there is very little good news. Perth and indeed Western Australia is in such a time right now. The last good year of the mining boom was calendar 2012; within a year it was painfully evident that the boom was over. Whichever dataset is consulted it is difficult to find positive trends in the west over the last three years.
Perth added 70,000 residents in the year to June 2012; it was at the time the fastest growing capital city in Australia in percentage terms. Figures for the year to June 2015 show the city tracking annual growth of just 30,000. And that was nine months ago. It is quite possible that Perth is now tracking annual growth of closer to 20,000. Growth, but growth at a scale of barely one-third that of the peak of the boom.
The problem is that often times expectations of demand are set at the peak of the cycle and it can take a few years until the community readjusts to a new lower-growth reality. Property and business prices and thinking adjust slowly over time. Perth is now in a state of adjustment and has been since 2013. Long-term residents and business operators well understand the west’s cycle of growth and development.
The fact is that Western Australia is a frontier community with a thin population base. When the cycle turns down in one industry such as mining, there is insufficient scale in other sectors to cushion the fall.
But the west has been through these cycles before (such as the early 1990s and the early 2000s) and it will go through them again (maybe the late 2020s). But for the astute business operator with faith in the future of the west these cycles represent opportunity: now is a time for expansion and investment.
For the rest of this article, click here: http://www.theaustralian.com.au/business/in-depth/perth-after-the-mining-boom-multicultural-gateway-to-asia-has-shed-its-fastestgrowing-city-status/news-story/c19c2efc26ac4bda71c35a20b4ef52ce