b'APRIL 2021 APRIL 2021REGIONAL VARIATIONS IN GROSS EXPENDITUREThe below two charts highlight the importance of migration on gross expenditure at a regional level. The charts plot GSP growth vs. total Net Overseas Migration in that region, comparing NSW+VIC and the rest of Australia. We can see from the chart that periods of cyclical upturn in state expenditure coincided with periods of strong gains in migrant population. This is particularly noticeable over the FY14-19 period where an upturn in migration into NSW + VIC coincided with strong GSP growth for both states. While the relationship between migration and state expenditure is driven by other factors (in particular demand for skilled labour through the mining investment boom), positive Net Overseas Migration flows clearly provide a separate, indirect boost to local demand.Fig. 2A. Migration and Gross State Product, FY05-19NOM (persons) y/y%250,000.0 4.03.5200,000.0 3.0150,000.0 2.52.0100,000.0 1.51.050,000.00.50.0 0.02005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019NOM (NSW + VIC) (LHS) GSP (NSW + VIC) (RHS)NOM (persons) y/y%140,000.0 7.0120,000.0 6.0100,000.0 5.080,000.0 4.060,000.0 3.040,000.0 2.020,000.0 1.00.0 0.02004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018NOM Rest (LHS) GSP Rest (RHS)Source: BIS Oxford Economics/ABS 13'