Bendigo’s Economy Faces Challenges Amid Strong Population Growth and Big Infrastructure Investments

Bendigo’s local economy hit its lowest point since the pandemic began in July 2026, with 413 jobs lost and a $28 million drop in output that month alone, accumulating to a 9.1% loss in total output since the downturn started, according to recent economic reports [1].

This contraction adds to ongoing concerns about employment stability in Bendigo as the economy grapples with shifts in key sectors. Yet, beneath the surface, strong population growth and major infrastructure projects are shaping a complex landscape that suggests recovery and growth potential over the coming years.

Population Surge and Workforce Demand

Between 2023 and 2024, Greater Bendigo recorded an unprecedented 65% annual growth in net internal migration, making it Victoria’s most popular regional destination for people relocating from other areas [2]. This surge is linked to Bendigo’s appeal as a lifestyle and business hub outside Melbourne’s metropolitan area.

As the population expands, labour market demands are expected to intensify sharply. Analysts project the region will need to fill 11,655 new jobs by 2027, rising to 44,124 by 2034 as retiring workers leave the workforce [3]. Growth will be particularly critical in health care, food production, and the visitor economy sectors, reflecting the region’s economic diversity and demographic changes.

Sectors with Mixed Fortunes and Infrastructure Investment

As of August 2025, employment data shows approximately 82,000 people working in the Bendigo Employment Region [4]. Retail trade exhibited strong growth with a 32.9% increase over the year, while construction jobs rose by 9.3%. Health care and social assistance, however, experienced a notable 14.9% decline in employment during the same period, indicating sectoral challenges despite rising population needs [4].

These mixed signals in employment coincide with significant investments aimed at boosting the economy. Construction advanced on Prime Urban Group's $55 million Prime Business Park in East Bendigo, currently supporting 250 workers with plans for further development [1]. A $100 million renewable energy project, the Derby Solar Farm with a capacity of 95 MW, began in 2025 to stimulate local job creation in the renewable energy sector and bolster economic diversification [5]. Additionally, Greater Bendigo has close to $1.6 billion in planned commercial and industrial projects set to commence between 2024 and 2026 [1].

The presence of over 7,900 small businesses across Greater Bendigo contributes vital economic activity, with sectors like hospitality, construction, professional services, and retail dominating [3]. This small-to-medium enterprise strength is supported by initiatives such as the Victorian Government’s Small Business Bus, which offers free advice to local entrepreneurs [3].

Looking Ahead: Balancing Challenges and Opportunities

While July 2026 data underscores an economic downturn, the broader context of rapid population growth and infrastructure investment presents opportunities to reshape Bendigo’s workforce and output profile. Job seekers and business owners should monitor sector shifts closely, particularly in health care and emerging renewable energy fields.

For policymakers, addressing the employment declines in health care and enhancing workforce skills in response to projected demand are clear priorities. Sustained support for small businesses and infrastructure projects will be essential components of economic revitalisation efforts.

Bendigo’s economic future depends on how effectively it can navigate the near-term setbacks while capitalising on its growing population and investment pipeline to build a more resilient and diversified economy in the years ahead.