Manufacturing News

New report confirms manufacturing not dead in Australia

Mining might have stolen the economic lime-light away from the Australian manufacturing in recent years, but according to a report released today by the NSW Business Chamber, Australian manufacturing will continue to be an important generator of economic activity and jobs in the years to come.

The report Manufacturing Futures prepared by the Australian Business Foundation and released at the NSW Business Chamber’s Manufacturing Futures Forum revealed that by embracing innovation, investing in skills and boosting collaboration, the local manufacturing industry has the potential to remain a vibrant source and generator of economic activity and also growth.

The report, which analyses the contribution of the manufacturing sector to the national economy and outlines the challenges and opportunities Australian manufacturers will face in the future, revealed that the manufacturing sector, contrary to popular belief, has been growing at an average rate of 0.9% and accounts for 8.7% of GDP or $111.1 billion in economic activity.

The sector also continues to be an important contributor to jobs, employing almost 1 million people or 8.7% of the workforce, and to exports, accounting for 36.1% of total exports.

According to NSW Business Chamber CEO Stephen Cartwright, manufacturing has a bright future in Australia.

“Manufacturing is not dead in Australia but very much alive and an important contributor to the nation’s economic health,” he said.

“A lot of sectors are doing it tough at the moment with the record high Australian Dollar, the shortage in skilled employees, and a move to a low carbon economy and manufacturing is no exception, but given the right incentives and a drive to adapt to the changing economic environment, manufacturing can continue to have a bright future in Australia.”

Business model innovation is a key area ground for manufacturers to differentiate themselves from competitors to gain that distinctive and lasting competitive edge.

“The most immediate, tested, and practical business model change open to manufacturers is to add service to their products, providing new tailored and valued solutions to their customers,” said Cartwright.

“Innovation, contrary to popular perceptions and much government policy, is more about problem-solving and learning than about scientific discovery, more about the customer than the producer, more about the marketplace than the laboratory, and more about business transformation than technology.

“The quality and competence of people working in manufacturing are decisive to the success of the sector. Analyses have shown that improving Australian management practices and workforce skills and engagement are vital to boosting both innovation performance and productivity.”

Cartwright argued that knowledge is power for the competitiveness of Australian manufacturing.

“Manufacturing, in the 21st century, should not be considered a solitary pursuit but a collaboration between manufacturing enterprises, customers, suppliers and knowledge sources providing new ideas and transforming them into new competitive capabilities.”

Cartwright said the Manufacturing Futures report reinforced the NSW Business Chamber’s focus on the manufacturing sector and the future of the manufacturing industry would feature prominently at the first annual Australian Chambers Business Congress to be held at the Gold Coast Convention Centre from 1-3 June 2011.

Göran Roos, Chairman of VTT International, Finland and Roy Green, Dean of the Faculty of Business, UTS, will be a key speaker on the future of the manufacturing sector at the Australian Chambers Business Congress.

Summary of the Manufacturing Futures report

The report states that the manufacturing sector will face seven forces of change in the future:
• more intensified competition;
• more complex and varied opportunities for doing business globally;
• shift from mass production to customisation and personalisation;
• growing importance of the low carbon economy;
• changing skills needs and imperatives;
• technology that transforms entire business models; and
• collaboration and connectivity that accelerates innovation and competitiveness.

The report concludes that leaders in Australian manufacturing firms would be well-served to focus on three areas for action:

• experimenting with business innovation;
• investing in people and skills; and
• multiplying their knowledge connections.

To read the full report, visit

Do you agree that manufacturing still has a pulse? Leave your comment below.


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