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Tradies ride the resources boom to the land of riches

Tradies ride the resources boom to the land of riches

THE mining boom has created a new breed of wealthy “tradies”, with a major study finding that almost one in five rich households in resource-rich Western Australia is headed by a tradesperson — twice the level of the rest of the nation.

The report by Curtin University and Bankwest found that Western Australia’s household wealth has risen by a “spectacular” $268 billion in less than a decade and that 18 per cent of high-income households were headed by a tradie, compared with 9 per cent in the rest of Australia.

In WA, 22.5 per of the state’s high-income households are headed by a person holding a trade certificate as their highest qualification, helping to debunk the myth that a university degree is needed to get ahead in the workforce. This has risen from 20 per cent in 2006, and compares with just 16 per cent for the rest of Australia.

While most low-income households in WA had also managed to boost their wealth in the boom years, the gap between rich and poor has grown.

The richest 10 per cent of households had about 3.8 times the income of the poorest 10 percent of households in 2003-04, but this climbed to 4.5 by 2011-12.

Study author Alan Duncan from Curtin University said: “There have been real gains among the lowest income households, but the report shows they haven’t been able to share in the benefits of the boom to the same degree as higher earners, financially at least.”

The report, to be released today, comes after WA’s Energy and Finance Minister Mike Nahan said at the weekend that he believed the resources boom had been more egalitarian than China’s recent economic advancement or the IT boom in the US.

“The biggest beneficiaries of Western Australia’s boom are the people who have been derided as cashed-up bogans,” Dr Nahan told a Perth Writers Festival event.

“There are many, many people who are on $150,000 a year as electricians and plumbers and builders’ labourers — the 65,000 people who fly to the mine sites from the airport in Perth every week.”

West Australian Greens senator Scott Ludlam pointed out that many people had not benefited from the boom, which had driven up the cost of living.

“There is a whole generation who will never be able to buy their own home, unless there is a gruesome real estate crash,” Senator Ludlam said.

The report found WA households were among the wealthiest in the country and Perth ranked third in the nation for mean household net worth, averaging more than $800,000 a household.

“There is no doubting the significant benefits flowing to the state from the resource boom,” it said.

“Strong and resilient international trade ensured that WA was protected from the most damaging effects of economic downturn that weakened most of the world’s economies.”

– ANDREW BURRELL

SOURCE:  THE AUSTRALIAN FEBRUARY 26, 2014 12:00AM