Home' Employment Forecast : October 2009 Contents The Age Employment Forecast
This sector has been hard hit, both in Australia and Victoria, in fact it has been hard hit right across the world other than in China
and India. In Australia, the decline accelerated in late 2008 when interest rates and the collapse in consumer confdence resulted
in a slowdown in the demand for manufactured goods. The Motor Vehicle and related parts sub-sector has been particularly hard
hit. The Textile Clothing and Footwear sub-sector has been struggling for years and the recent crisis has only accelerated the
problem. This sector is now a third of the size it was in the 1980’s. The plastics and chemicals sub-sector is also experiencing the
fastest rate of decline recorded. The decline really started in 2003, but underinvestment since than, combined with improved
quality from Asian manufacturing have placed real competitive pressures on this sub-segment. Even food manufacturing, which
was growing jobs in 2007/08, is slowing. This sub-sector is also facing issues of underinvestment in new plants, weak exports,
especially in the wine sector, and the continued drought in southern parts of Australia. The malaise experienced in this sector is
refected in business confdence, which is the lowest of any sector recorded.
Looking forward, the demand for manufactured items that support the mining sector, such as specialised plant and machinery,
will experience a rebound in growth as the mining sector recovers. Building products manufacturing is another sub-sector that
took a big hit as the GFC bit hard. With some improvement in 2010 for new housing and Government infrastructure spending, this
sub-sector will experience some welcome increase in demand. Overall, however, the outlook is for further job losses.
Victoria still has a relatively high proportion of its economy associated with manufacturing (11.5% of jobs) and jobs have been
slashed recently, impacting on employment growth in the State. The car sub-sector has been hard hit with more lay-offs at the
Ford factory in Geelong and there are more to come. Ford has announced it is closing an engine plant in 2010 costing 600 jobs.
Pacifc Brands has also announced closures to some of its manufacturing operations in Victoria at a cost of 554 jobs. With a pick-
up in the economy, this sector is forecast to improve from its current position, but still lose jobs over the frst half of 2010.
Private Business CapEx
Machinery and Equipment
Trade Weighted Index
Source: EMDA Model 2009
Change in Jobs
Change in Jobs Quarterly
This sector has suffered across the world and Australian Manufacturing is no exception
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