The Tasmanian Government is hailing the latest State Final Demand data which is says leads the nation and shows the highest quarterly growth in 18 years.
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Premier and Treasurer Peter Gutwein is also buoyed by a massive increase in spending in the hospitality sector.
However, leading independent economist Saul Eslake is more cautious and Labor is worried about Tasmania's unemployment rate.
"Pleasingly, hotels, cafes and restaurants saw a massive increase of 86.1 per cent in spending reflecting the easing of COVID-19 restrictions, and Government stimulus programs, including our "Make Yourself At Home" travel voucher scheme," Mr Gutwein said.
"The latest ABS figures show Tasmania experienced strong growth of 5.5 per cent in the September quarter as we recover and rebuild from the impacts of the COVID-19 pandemic.
Mr Gutwein said State Final Demand was a key economic indicator of the State's economic performance and the September growth was driven by increased consumption of 10.6 per cent "reflecting increased confidence in our recovery".
"Supporting demand state-wide, Government investment grew 4.5 per cent in the quarter, the largest increase of any state, as we moved quickly to stimulate our economy with our construction blitz announced in June that brought forward funding and rolled out screwdriver and paint-brush ready projects," he said.
"The ABS also noted that there was a 36.2 per cent rise in health, reflecting the return of elective health services.
"Despite the Opposition's relentless negativity and their focus on recession and talking our economy down, this data confirms that Tasmania is not in recession and never has been in 2020 which has been a very challenging time for economies around the world."
Mr Eslake said the 5.5 per cent increase was better than the national average of 4.5 per cent - "but that national average was dragged down by the -1.0 per cent in Victoria".
"Take Victoria out and the national average was +6.4%, and Tasmania was of course less than that," he said.
"Another way of looking at it is that Tasmania's figure was less than the Northern Territory's +6.0 per cent, South Australia (the state most like us) +6.7 per cent, and NSW and Queensland +6.8%.
"Apart from Victoria the only jurisdiction with a lower growth than Tasmania was the ACT +2.0 per cent - but of course the ACT only went backwards by -1.7% in the June quarter compared with -7.5% for Australia as a whole and -8.0% in Tasmania."
Mr Eslake said Tasmania's state final demand in the September quarter was 2.1 per cent below the pre-pandemic December quarter.
"So, Tasmania's certainly had a good rebound from the sharp contraction in quarter two. But are they as good as the government suggests - no. Comparing us with a national average dragged down and distorted by Victoria's unique problems is not setting the bar terribly high."
Labor treasury spokesman David O'Byrne welcomed the "partial rebound" since the pandemic, but said it was "coming off a very low base".
"There's no place for complacency if we're to turn around the state's economic decline," Mr O'Byrne said.
"10,600 more Tasmanians have been thrown out of work since COVID.
"At 8.2 per cent Tasmania has the worse unemployment rate in the country."
Tasmanian Chamber of Commerce and Industry chief, Michael Bailey said with the Tasmanian economy beginning to open up, the recovery was being driven by businesses right around the State.
"It's great to see there was an 86 per cent increase in spending at hotels, cafes and restaurants given how hard they have been hit by COVID. The reality is that it's the private sector that is driving our economic recovery," Mr Bailey said.