Queenslanders are getting their mojo back when it comes to spending, but the economy will continue to struggle until state and international border bans are lifted.
That’s the prediction from Deloitte Access Economics, which released its quarterly Business Outlook on Monday.
It found the sunshine state had been hit harder than some other jurisdictions due to its reliance on tourism and hospitality.
Queensland has the second-highest unemployment rate in the country, behind Victoria.
“The closure of international borders have ground the state’s normally bustling international tourism sector to a halt,” the report stated.
“Where domestic tourism may have been able to fill some of that void, the closure of state borders has made that all but impossible for most of this year.”
Queensland’s economy has been further hampered by reduced demand for coal and Australia’s trade tensions with China.
“In response to these fears (and the great unknown of COVID), confidence has taken a battering,” the report stated.
“Businesses aren’t spending, and it’ll take a good jolt to change that.
“That’s particularly true for the businesses tied to tourism and hospitality — you can’t invest if you don’t know when you’ll have a market for your services.”
However, it’s not all bad news.
The Deloitte Access Economics report praised the state government for its health and economic response to the coronavirus pandemic.
It also found Queensland consumers were getting their “mojo” back.
“With the state’s domestic borders beginning to re-open, pent-up demand is expected to accelerate the recovery, driven by those wanting to visit friends and relatives following the ‘Great Lockdown’,” it stated.
“Assuming state borders open before international ones, there’s also the potential for Australians to redirect some of their plans to travel overseas to domestic locations, which would bode well for the sunshine state.”
But the report found the state’s full economic recovery hinged on the reopening of state and international borders.
“Until then, the Queensland economy will struggle to get out of third gear,” it stated.
Premier Annastacia Palaszczuk on Monday said an announcement about borders would be made at the end of October.
Despite ongoing pressure to reopen, the state remains closed to NSW and Victoria.