Ag regions continue to drive national GDP during pandemic

Ag regions continue to drive national GDP during pandemic

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A regional renaissance could be the key to economic recovery post-COVID-19, with resource and agricultural regions still driving national GDP, according to the Regional Australia Institute.

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A regional renaissance could be the key to economic recovery post-COVID-19, with resource and agricultural regions still driving national GDP, according to the Regional Australia Institute.

The latest figures show new job postings in regional Australia hit 11,000 in June; a 22 per cent increase from May. This compares well with an 11pc increase in new job postings in June in mainland state capitals.

RAI chief economist Kim Houghton said the huge variation in the number of businesses on JobKeeper across regional Australia indicated the extent to which some regions are in a stronger position than others.

"Rural postcodes such as Moura, Bordertown, Donald, Cressy, Hopetoun, and Yenda are all examples of areas that have a very low number of businesses registered for JobKeeper - less than 50 in fact," Dr Houghton said.

"In contrast, Queensland postcodes of Cairns, Toowoomba, Surfers Paradise and Southport each have over 2,400 businesses registered. Byron Bay, Margaret River, Eumundi, Gold Coast hinterland, Apollo Bay, Barossa Valley and Launceston are also areas with a high reliance on JobKeeper," she said.

Rural Bank CEO and Group Executive Partnerships, Marketing and Corporate Affairs at Bendigo and Adelaide Bank, Alexandra Gartmann, said it was important to keep sight of local economies and how different sectors are being affected by the crisis.

"The accommodation and food services industry has been the hardest hit, with 83 per cent of our customers reporting significant revenue loss. In contrast, 24 per cent of agriculture, forestry and fishing customers have been similarly affected. A challenge for agriculture is now in sourcing labour, which will create new regional employment opportunities," Ms Gartmann said.

"Supporting local businesses is essential to rebuilding the economy. From our customers, we've also seen a real commitment to buying local and supporting Australian businesses across all geographic groups - urban and regional," she said.

"While focus has rightly been on supporting public health and the national economy, we must continue to look at smaller, local economies and the important role that they play in the broader Australian economy."

Dr Houghton said JobKeeper had been a lifeline for some areas of regional Australia that had economies based on heavily-impacted sectors such as tourism, hospitality, and transport. It has kept money flowing into, and then around and within communities.

"Winding it back incrementally and essentially giving regional businesses more time to adapt is greatly appreciated, and is vital for the survival of some," she said.

"We are really starting to see the divergence in economic performance between regions and now is the time to consider place-based recovery responses which are tailored to each region's needs."

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