By Jeff Bell.
The WA Government needs to focus on a longer term strategy to attract business in the down cycle of our economy, according to Chief Economist at the WA Chamber of Commerce and Industry, Aaron Morey.
An over-reliance on resources would be disastrous in the event of an inevitable downturn.
The steady decline in the price of iron ore over the past month, while from a high peak, was cause for serious concern. The implications for WA in particular were stark, but the national economy would also be seriously affected.
In addition, with higher worker demand and restrictions on internal migration, labour shortages are expected to continue into 2022. Strong action was needed immediately, he said.
These strategic matters anchored an absorbing Guest Conversation when Aaron visited BoLA members and guests last week, during their monthly meeting, this time at the Mt Lawley Golf Club.
BoLA is a peer membership group for business owners and chief executives. Our purpose is to develop outstanding leadership in a stimulating, confidential setting, through a full-day group meeting and one coaching session each month.
The lead-in topic for the conversation with Aaron was SMEs in the WA Economy–considering likely implications and opportunities for the sector that relies so heavily on the resources multinationals.
In a packed 90min. Aaron and the group also covered:
- Greater insights into the stressors on the WA economy.
- Management of the economy under the stress of COVID-19 and the emerging conflicts between States and the Commonwealth.
- Examples of CCIWA advocacy, interactions and offerings, including assistance into South-East Asian markets.
Aaron said that mining was making a massive contribution the Western Australian economy at 43% of Gross State Product. The challenge was to develop the contribution of other sectors.
Adding to the drive for capacity, in WA at least, would be what is shaping to be a record grain harvest. This would put further demands on the labour market with most farms searching for harvester and truck drivers.
The economy was recovering from the pandemic better than expected, due in large part to the WA resources exports. Also, clever use by the Federal Government of job keeper payments had kept most industries turning over, compared to the USA model which encouraged a massive blowout in unemployment claims.
The job keeper payments had also been a major factor in the dramatically lower rate of business failures in the past 18 months.
Aaron said that the next few years are going to be interesting for the WA and national economies. There was an especial urgency to push harder on reforms for small and medium-sized enterprises.
Aaron particularly highlighted the burden of payroll tax, an intolerable penalty, he said, on small and medium-sized enterprises who could be hiring more staff.
Aaron is also Director of Policy and Influence at the Chamber of Commerce and Industry WA.
Prior to joining CCIWA, he was a political and economics adviser to the WA Treasurer, Ben Wyatt. In that role Aaron was also Chief of Staff. He advised the Treasurer on economic and commercial issues, managing significant projects including GST reform, major asset sales, and the Bell Group negotiations.
Aaron began his professional career with over 7 years at the Australian Productivity Commission in Melbourne, where he prepared advice for the Federal Government on issues including industry development, labour markets, intellectual property, superannuation, infrastructure and energy market regulation.
BoLA members will meet again in September, with our agenda a mix of external input, such as the above, intensive attention to strategic issues and opportunities raised within the group and leadership development activities.
Membership applications are welcome.