The Centre for Agribusiness has started work on an analysis of regional economies, with Dr Shawn Leu, and researcher Mr Ed Lefley contributing to the project.
This analysis will be examining the commonly held view that regional centres struggle economically compared to metropolitan and capital city areas. Work is being undertaken to quantify this perspective, with an approach that seeks to examine the sensitivity of changes in the employment level in the region relative to that of the state or national level. This gives a simple measure of a resilience index in that higher index values (above one) represent relatively low resilience of the region to a particular economic shock; whereas lower index values (below one) signify relatively high economic resilience of the region.
The analysis takes particular focus on regional centres closer to home. Our researchers compute the resilience index for Armidale and Tamworth from 2011 to 2016 in relation to the national and NSW state employment changes (please the diagram below). So far, three observations have been made:
- Apart from the large spike for Tamworth in March 2011, the resilience index for Armidale and Tamworth are closely synchronised in terms of their cyclical variations.
- There was improvement in the resilience index number in the first two quarters of 2014 for Armidale and Tamworth, and this was even more pronounced as shown by the state index numbers. Prior to the improvement there was marked deterioration at the state level but not apparent to the same extent at the national level.
- At the start of 2016, the resilience index suggests that Armidale and Tamworth are less resilient against national employment changes but more resilient at the state level.
The next stage is to examine the factors that relate to these variations.
NSW is recognised as one of the leading states in terms of economic performance. The development of an indicator for regional economies is intended to allow for a similar comparison to be made at an intra-state level.