WA's mining boom is about to peak, with wages growth to slow and some planned "mega mining" projects at risk of being shelved, one of the country's top economic forecasters has warned.
The latest Deloitte Access Economics Business Outlook, released today, said falling commodity prices and rising business costs for miners had cast doubt on the State's long-term growth prospects.
But it expects WA to be shielded from a global economic downturn because of the resources projects already under construction.
Australia remains a standout economy on the world stage and, in July, notched its 21st straight year without a recession. Overall outlook for growth remained strong.
But the report said that, far from celebrating, Australians had taken a glass-half-empty approach to the economy.
It said WA had some handy insurance in case the global economy deteriorated, and could sustain a downturn for up to two years.
"There is a lot to cheer about in WA," the report said.
"Growth is good - verging on great - and the pipeline protection offered by projects already under way means that, even if the global outlook were to worsen, WA's activity would have the buffer of projects still being finished."
But, while WA looked good for the short term, the report cautioned that the boom was "already pretty long in the tooth" and would not last forever.
It said investment in new mining projects would peak in 2014 and 2015.
Commodity prices were falling but the dollar remained high, while governments were not doing enough to ease skill shortages or make it easier to move to WA to meet demand for labour.
The carbon and mining taxes and a rise in State royalties had also pushed up the cost of business, while demand for minerals from Asia was being reassessed.
The report said the positives for WA included the housing market appearing to pick up. Government public projects such as new hospitals could take up some of the slack in the construction industry.
Deloitte Access Economics predicted wages growth in WA would slow from 8.7 per cent last financial year to 3.8 per cent by 2016-17 while unemployment would continue to hover around 4 per cent.
A separate report, Commsec's State of the States, continued to rate WA as the nation's economic powerhouse.
The State finished on top in the key indicators of economic growth, construction work, low unemployment, retail trade, population growth and equipment investment.
But it lagged in the crucial housing sector, ranked third for housing finance and fifth for dwelling starts.