The Northern Territory’s (NT) economic outlook explores a range of key economic indicators and industries, with forecasts produced for economic growth (gross state product and state final demand), population growth, employment growth, unemployment rate, prices (consumer price index) and wages (wage price index).
Gross state product | State final demand | Population | Employment growth | Unemployment rate | Consumer price index | Wage price index
The following is a summary of the NT's economic outlook, as published in the 2025-26 Budget.
Gross state product
- The NT’s domestic economy is growing solidly in 2024-25, driven by strong public investment spending and construction of the Barossa project, with state final demand expected to grow by 4%. However, gross state product will contract by 2.6%, driven by lower exports from the Ichthys liquefied natural gas plant due to unexpected maintenance in late 2024 (Chart 1).
- In 2025-26, the NT's GSP is forecast to grow by 7.8%, driven by the Barossa project’s transition from construction to LNG production for export. Although private sector investment will detract from growth during this period, this impact is outweighed by higher exports. By 2026-27, the Ichthys and Darwin LNG plants are expected to be at full operational capacity, with exports continuing to fuel GSP growth. In 2027-28, export levels are forecast to stabilise, no longer contributing to growth, while public investment is anticipated to decline from recent highs to more sustainable levels. By 2028-29, the Territory’s GSP growth is expected to revert to trend.
- The projections made in the economic outlook do not factor in potential or planned projects that are yet to reach final investment decision.
- Ongoing uncertainty in relation to trade disruption, tariff rates and associated volatility in financial markets is weakening consumer confidence and business sentiment, which if sustained will have implications for consumption and business investment, including in Australia and the NT.
State final demand
- SFD is forecast to grow by 4.0% in 2024-25 (Chart 1), underpinned by growth across public consumption and investment as well as private investment and household consumption.
- Growth in public consumption is driven by ongoing demand pressures across frontline services such as health, justice and corrections, as well as revised timing of various programs. Public investment spending is currently elevated reflecting a number of significant large-scale projects across key portfolios including transport and logistics, public housing and defence.
- Household consumption will be supported by moderating inflation, real wage increases, tax cuts and easing of monetary policy. Private investment is estimated to increase in 2024-25, before contracting in 2025-26, as the construction phase of the Barossa project is completed.
Population
- The NT’s population is expect to grow by 0.7% in 2024-25 (Chart 2). Population growth is expected to remain steady as natural increase remains flat, contributing around 0.8 percentage points to growth, and interstate and overseas migration flows continue to ease from recent levels, detracting 1.1 percentage points from and contributing 0.9 percentage points to growth, respectively.
- Population growth is forecast to increase to 1% in 2025-26. Natural increase, in particular births, is forecast to recover as migration outcomes improve and cost of living pressures ease. Elevated public final demand is a key driver of economic activity and labour force needs in the NT. This is expected to support improvements in interstate migration outcomes and ongoing overseas migration into the Territory.
- The NT’s population is forecast to continue growing over the forward estimates period (2026‑27 to 2028‑29), averaging 1.2% growth per annum and reaching 268,557 persons in 2028‑29.
Employment
- NT employment is expected to increase by 1.2% in 2024-25, before easing to 0.8% in 2025-26 as several major investment projects are completed (Chart 3). Employment is forecast to grow by 1.2% in 2026‑27, in line with population growth, before settling at 1.6% over 2027-28 and 2028-29.
Unemployment rate
- The unemployment rate is forecast to increase to around 4.5% in 2024-25, before increasing to 5% in 2025‑26 (Chart 4), reflecting softer labour demand as the construction of the Barossa project moves towards an expected completion date in September 2025. Over the forward estimates period, the unemployment rate is forecast to moderate to 4.5% by 2028-29 as employment growth improves.
Consumer price index
- In year-ended terms, growth in Darwin’s headline CPI is estimated to decline to 1.7% over the year to June 2025 before accelerating to 2.9% over the year to June 2026 as the Commonwealth energy bill relief ends. Across the forward estimates period, year-ended CPI growth is expected to return to 2.5%, consistent with the midpoint of the RBA target band.
- Inflation in Darwin appears to be largely contained and is expected to remain close to the midpoint of the RBA target band, with temporary deviations reflecting Commonwealth energy bill relief (Chart 5).
Wage price index
- Wage growth is expected to continue moderating in 2024-25 as wage pressure eases after reaching a recent peak (Chart 6). NT wages are estimated to grow by 3.2% in 2024-25 and by 3% in 2025-26. Across the forward estimates, wage growth is expected to increase to around 3.3%.