EACH year, Western Australia must find a population equivalent to that of Mandurah if the state is to capitalise on the economic opportunities created by the resources boom over the next five years, a leading economic forecaster has predicted.
EACH year, Western Australia must find a population equivalent to that of Mandurah if the state is to capitalise on the economic opportunities created by the resources boom over the next five years, a leading economic forecaster has predicted.
According to research by ACIL Tasman, WA faces a number of critical short-term challenges that will determine how successfully it capitalises on the resources boom.
With proposed resources project investment of $180 billion projected for WA between now and 2016, the next investment cycle is set to dwarf all those of the past.
ACIL Tasman estimates annual investment in WA peaked at $5.5 billion in 2008, almost double the level in 2007 and roughly 10 times the average level of investment for the 15-year period to 2005.
But with the huge anticipated surge in iron ore and gas development over the next few years, it expects “the next investment wave will be a tsunami” that could lift annual investment in WA to $20 billion by mid 2012.
ACIL Tasman says recent labour demand studies indicate that level of investment means the state will need to find about 400,000 new workers by 2016, and that WA could be facing a shortfall of 150,000 workers by that time unless action is taken now.
Government figures show WA’s population is already growing faster than that the national rate – about 3.25 per cent in 2009 versus 2 per cent for Australia nationally.
But ACIL Tasman estimates that WA’s population must grow by at least 70,000 people – roughly the population of Mandurah – every year to meet the demands of the resources boom.
“We have to absorb a new Mandurah every year and that’s not easily done,” ACIL Tasman director Ian Satchwell told WA Business News.
“When you think about how much capacity was sucked up in 2008 – even getting a taxi was difficult – there are going to be some real capacity issues there that we will have to deal with through a range of measures.”
Mr Satchwell said organic population growth could only add about 20,000 people to WA’s population annually, meaning the vast majority of people would have to come from outside the state’s borders.
However, WA continued to struggle to attract interstate migrants, with just 3,000 eastern states workers migrating to WA last year.
That would only become tougher as WA faced growing competition for workers from Queensland, which is also booming, he said. “That Nullarbor is a big barrier,” he said.
WA also needed to arrest a long-standing “brain drain” of young talent, which resulted in WA suffering a net 3 per cent loss of university-qualified 25-34 year olds between 2001 and 2006.
Mr Satchwell said those trends made it especially important to debate how to make Perth a more vibrant place in which to live, and improve its appeal to WA graduates and experienced professionals living outside the state or overseas.
However, he said the only feasible way of meeting the state’s population and labour needs was to increase international immigration, which already accounts for about two thirds of WA’s population growth, the highest rate for any Australian state or territory.
“There is no option, just from a workforce requirement perspective, other than to bring in a lot of people from overseas, whether it is short term or permanent migration,” Mr Satchwell said.
While fly-in, fly-out working arrangements would also have to play an even bigger role in meeting the state’s labour needs, Mr Satchwell said fierce competition for workers from Queensland was likely to spawn an influx of “international FIFO” workers.
“I think we are going to see Singapore becoming a labour aggregation hub for skilled FIFO workers from Asia,” he said.
