SA well on course to economic recovery

As per the business outlook reports published recently, Australian economy is likely to get back on track in the next 2-3 years and there are clear signs of economy emerging out of the global financial crisis. People are returning to their old spending habits without feeling the pressure of saving for the uncertain days ahead. With people more relaxed about future because of signs of revival in the economy, they are more willing to take out their credit cards and go out and spend on wide variety of items than during the period of slowdown.

Apart from increased level of spending by people at retail shopping outlets, housing sector is also experiencing an increased level of activity, especially in SA in comparison to the national average. The national average in terms of houses constructed is experiencing a continuous slide recently, yet SA is one state where there has been several favourable changes taking place in recent times that strongly point to good days ahead. The stable housing prices, stable rtes of vacancy, stable population growth are all pointers to the fact that the migration from SA to interstate is on a decline for some time now.

There is a strong presence of international students seeking migration in SA from a number of countries, such as China, India, Korea, Vietnam and Malaysia. These international students are spending more in the retail sector, as per the report and there has also been a much higher level of overseas students coming to SA than to any other part of Australia. There is also an increased level of migration of skilled labour in SA to match the demand of labour because of increased business activity in the state. Part of the credit for this definitely goes to the government, which has used various means to attract business investment in the state by projecting SA as the Defence state.

There are, however, no signs of revival for manufacturing sector and a few other sectors, such as wine, wool and car exports which are likely to suffer for some more time because of lost sales in the global market as a result of pervasive effect of slowdown in the world economy as predicted in the report. Business investment is still not good and it may be quite some time before there might be the same level of entrepreneurial activities in the economy as existing in the pre-slowdown phase.