Boom, bust and everywhere in between for North Queensland industries

TropicNow columnist and business advisory specialist Shaun Donaldson believes the NQ economy can be summed up in two words right now: "mixed bag".

I'm often asked for my view of the Cairns economy.

Everyone wants to know how Cairns is going. My reply is always: "it’s a mixed bag".

Whilst it would be great to have a quick grab to sum up the state of our local economy, the reality is some industries are stronger than others.

Based on my observations, this is my take on what's happening in a variety of sectors.


You don’t need to be "in the know" to see that tourism is flying.

After several tough years many tourism businesses and accommodation providers are achieving record, or near record, numbers.

I don’t begrudge them this success for a second, given they have survived tough conditions for a prolonged period.

I know that some businesses in other sectors are disappointed these benefits are not flowing through to the broader economy, a trend I put down to businesses banking some profits to offset some big losses post GFC.

If tourism stays strong then I believe we will see this industry drive broader economic growth in the next 12 months.


Whilst some mainly well-established, well-located businesses are doing well, hospitality has been tough for other businesses.

Many café’s and restaurants are struggling as a result of a lack of consumer confidence and increased competition. I believe continued economic growth that will increase consumer confidence will give these businesses a boost in the next two years.

Health and Community Services

This industry is the biggest employer in Cairns and with an ageing population has become the source of the biggest employment growth Australia wide.

Macro-economic factors coupled with the NDIS will see this industry continue to grow. In some sectors competition has resulted in tough businesses conditions however I am confident good businesses in this sector will have a bright future.


It is very difficult to summarise such a diverse sector, however I believe overall the ag sector is in a better place than it has been for some time.

Cattle prices are up, as are prices for some tropical fruits.

On the downside drought in some areas has meant they have not been able to enjoy the rebound in cattle prices, and sugar and bananas have both been hit by price pressures and over-supply.

Whilst weather events and external price pressures will continue to affect individual properties I see a bright future for North Queensland agriculture, as long as we can find an economical way to access domestic and international markets.

Building and construction

This sector has been subdued with some limited construction activity in Cairns in recent years.

Overall conditions remain tough across the industry, particularly in civil construction.

There are some big projects (government and private sector) on the horizon that will provide opportunities for commercial and civil construction and growth in the local economy will see residential housing construction pick up again.

Hopefully this industry will see positive growth on the back of tourism and infrastructure investment in the North.


This sector is a real mixed bag, which is typical of retail nationally.

Some local businesses are doing well whilst others are struggling and closing their doors.

I believe there are national and global factors at play here that will continue to see retail very hit and miss.

However once again positive local economic news will lift consumer confidence and give this sector a boost.


Outside of a few isolated businesses, mining and mining services is very tough in North Queensland.

Unfortunately I believe there are at least a few more tough years for the industry before it sees positive growth.

Next Thursday: Shaun Donaldson takes a look at exactly how the Cairns economy is stacking up against regions and cities across Australia.