Adaptive Cycle Indicators

A system’s resilience can only be assessed by determining its current position within the adaptive cycle. Socio-economic indicators will be used to determine the relative position of individual components within the cycle and a judgement made on the relative position of the focal system itself.

Port Phillip Bay is able to support a range of economic activities (Figure 11). Economies like any system are subject to the adaptive cycle. Port Phillip Bay has seen large phase of growth in each of the areas listed. A number of key indicators will be used to ascertain their position within the cycle. From this the general Port Phillip economy will be assessed.

Figure 11: Economic activities occurring within and around Port Phillip Bay (Australian Bureau of Statistics, 2008)

The tourism industry for the period 2007-08 accounted for 5.89% of the Victoria State GDP (Pambudi et al., 2009). This was equivalent to $15.8bn (3sf). The total number of arrivals in Victorian accommodation has risen steadily from 1366,000 in 2001 to 1776,000 in 2009 (Figure 12). This is a rate of increase of 45,600 (3sf) a year. Guests have also been staying longer. 2797,000 nights were spent in tourist accommodation in 2001, which has risen to 3768,000 by end of 2009.Economic data was retrieved from the Australian Bureau of Statistics for the years 2001-2009. To assess a systems position in the adaptive cycle a greater period of time should be used. However data on economic indicators was either; not of a sufficient detail or was unavailable before these dates. The data should be sufficient to determine whether or not components are growing, being conserved or collapsing.

Figure 12: Total number of arrivals (red) and guest nights (blue) for 2001-09 (millions)

This appears to suggest that the tourist sector is still able to attract visitors. This is reflected in the total occupancy rates and the total takings. However there are two critical times that appear to have shaken sector.

Figure 13: Income generated ($m) by tourist accommodation
Figure 14: % occupancy rate for tourist accommodation

A second occupancy drop occurred in 2007. A drop from 63.7% to 59.1% by 2009 can be identified. The total number of guests and nights stayed had again remained steady. Takings however continued to rise throughout 2007-2008. It was only by the end of 2009 that they began to fall.  The 2007-2008 event is one that shall be discussed later as it highlights the effects that a disturbance can have on a system.A fall in takings (Figure 13) of $8m from $214m occurred between 2001 and 2003.The occupancy rates (Figure 14) fell from the starting point of 55.5% to 53.5% over the same period. The total number of guest nights and arrivals however remained relatively stable

Figure 15: Value of exports and imports for Victoria and the trade deficit ($billion)

Tainter (1998) stated that when any costs to a system outweigh the benefits, it collapses. For trade a measure of the values of goods imported and exported has been used to examine this proposal.The Port Phillip Bay waters are a major national and global hub for shipping and trade. X amount of cargo passed through in 2009 and has played a crucial historical role in the regions development (Figure 19). The 1800s gold discovery lead to an increase in the population and resulted in rapid development of settlements (Tourism Victoria, 2009).

Figure 15 shows the value of goods that pass through Victoria State each year from 2001 up to 2009. Exports have fallen from a high in 2001 of $21bn to $20bn by the close of 2008.

Imports have risen from a low of $39bn in 2001 to $56bn in the year 2008-09. Crucial here is the trade deficit. The deficit is a monetary value that is assigned to the difference between how much the state exports and imports. The deficit has increased in size from around $18bn to $36bn. That is to say the costs to the system exceed the values that the system provides, via trade, by $56bn.

Figure 16: Total numbers of employed (blue) and unemployed (green) for Victoria (millions)
Figure 17: Unemployment rate (%)

Another measure by which we can assess the system is through employment figures. Figure  shows the numbers of employed and unemployed persons. The total number of employed persons has increased by 445,000 from 2.32m in 2001 to 2.77m in 2009. The total number of unemployed persons has risen only by 3,000 to 151,000 over the same period.
The system has not collapsed, as per Tainter’s theory. The trade deficit is a crude measure and cannot be taken in isolation. The system will provide economic benefits that will not be exported and are not taken into account here in the trade statistics.

Figure 18: House Price Index (HPI) between 2005 and 2009

House price growth is a signal for increased demand, which in turns is representative of a growing economy (Himmelberg et al., 2005). Price devaluation can occur through local economic shocks reducing demand.  To measure the demand for housing the House Price Index (HPI) shall be used. The HPI measures the price change of the stock of established houses over time. There are two types of index; established and project. The established index values houses that currently exist and are ‘established’. The project index concerns homes that are to be constructed on a ‘client’s block of land’ (Australian Bureau of Statistics, 2009). The index allows comparison of two or more sets of values in reference to a base value of 100.The unemployment rate has fallen from a high of 6% to its lowest in 2007-08 at 4.7% (Figure 16). In 2009 this has risen dramatically to 5.2%.

Both the project index and the established indexes have grown from the base level of 100 which was set in the first quarter of 2004. The established HPI has grown from 102 in the final quarter of 2004 to 140 in 2007-08 (Figure 18). That is to say that the value of houses has risen by 38% of that of 2004 valuations. The project index however has not grown as fast and is currently at a high of 113 having increased by only by 10 points over the same period.

Previous: Component and Service Scales

Next: Cycle Assessment


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