Resources building richer regions

A study shows Australian regions with extensive resources development have higher levels of income and educational attainment, as well as more families and more working aged people, than other parts of regional Australia.

The demographic study by KPMG debunks many of the myths about the resources sector, including the onshore gas industry.

It indicates that resources developments are not only making regions more prosperous, but also making their communities more stable and socially sustainable.

The study compiles key standard-of-living measures and basic demographic profiles of Australia’s nine main resources regions. It was undertaken for APPEA and the Minerals Council of Australia.

It shows that resources (petroleum and mining) developments have driven a three-fold increase in high-income earners in these regions.

In 2006, five per cent of the resident population in resources regions earned $2000 per week or more, but by 2011 this had increased to 13 per cent of the population. This compares with five per cent across regional Australia.

It is clear that resources developments are driving these regions’ economies. KPMG found that in the five years to 2011, the number of people employed in the resources sector across the sampled regions grew by 13,810 – or 50 per cent. The number employed in all industries – including resources – grew by just 14 per cent.

In that same period, the population of Australia’s resources regions had grown at 1.5 per cent per year. This was the same as the national average but greater than the 0.8 per cent for regional Australia more generally.

This disproves claims that fly-in-fly out employment systems mean resources regions’ populations are not increasing. Yes, employees are flying in and flying out, but they are also also moving to the resources regions.

As the KPMG report states: “Employment opportunities in resources Australia are stimulating the resident population growth crucial to sustainable communities.”

The Surat Basin

Queensland’s Surat Basin – the region with the most coal seam gas industry activity – is an interesting example.
In the Surat between 2006 and 2011:

  • the population increased by 3.2 per cent
  • the total number of dwellings increased by 8 per cent
  • students finishing Year 12 increased by 4.3%
  • residents with tertiary degrees increased by 2 per cent

Despite the rise in population, the unemployment rate remained stable at about 4 per cent – well below the Australian and Queensland averages.

The number of residents at the same address that they were living in five previously increased by 3.3 per cent. So despite an influx of new workers, there are strong indications that locals no longer have to leave the region to find work.

In addition, in the last five years the retail trade sector has overtaken healthcare and social assistance as the region’s largest industry of employment. This rebuts claims that money being made in the region is not being spent there.

These figures indicate that the resources sector – which in this case is mostly the CSG industry – is making the Surat more prosperous, stable and sustainable .

The report also found that:

There is higher full-time employment in resources regions – 66 per cent compared with 58 per cent across regional Australia

  • All but two resources regions recorded an unemployment rate below the national unemployment rate (5.2 per cent) and the regional Australian unemployment rate (5.4 per cent)
  • There is a slightly higher proportion of families in resources regions than non-resources regions. 34 per cent of resident households are made up of “mum, dad and the kids” in resources regions, compared to 33 per cent across regional Australia
  • There are higher rates of Year 12 completions in resources regions – 41 per cent compared with the regional Australian average of 37 per cent
  • Home ownership is lower at 61 per cent compared with 70 per cent across regional Australia
  • Resources regions tend to have a higher working age population (people aged between 15-64) than other regional areas.

The resources regions examined were the Surat Basin, the Pilbara, Central-West WA, North West Queensland, the Hunter Valley, Kalgoorlie-Boulder, Central SA, the Galilee Basin and the Bowen Basin.