UPDATE 11.51am: EMPLOYMENT is growing on the back of an expansion in the mining and construction sectors, Prime Minister Julia Gillard says.
Opening the jobs forum in Canberra today, Ms Gillard said Australia’s strong terms of trade continued to help the economy, which had emerged from the global financial crisis in a strong position.
But there were pressures in some industries, such as tourism and manufacturing, due to the strong Australian dollar, she warned.
“We’ve got employment growing and we’ve grown by 5 per cent since the days of the global financial crisis,” she told delegates at Parliament House.
Ms Gillard said that while Australia was not immune to risks remaining in the global economy, it was well placed due to its geographical closeness to Asia, where there was a burgeoning middle class.
“So, in this age of change … we know we are living in a region of growth,” she said.
Still, there was softness in the retail sector, as consumers substituted services for goods, and on-going concerns about the tourism industry.
On the back of cyclones, floods and the strong Australian dollar, the tourism sector had been struggling in 2011.
“In some parts of our tourism sector, they continue to see vacancy rates in the order of 9 per cent and find it difficult to get the workforce they need,” Ms Gillard said.
Australia also needed more workers in health and child care.
Ms Gillard conceded that not everything could be solved in a one-day forum, but she laid out what she hoped to achieve during the day. She said there was a need to develop a deep and shared understanding of current trends and future opportunities in the Australian economy.
“That we will develop a shared and deep understanding of the vision we have for the future of individual sectors of the economy,” she said.
“During this phase of economic transformation we want to make sure that we retain diversity in our economy we will need today and we will, certainly, need tomorrow, in the days that lie beyond the resources boom, however far away those days are.”
Treasurer Wayne Swan told the forum Australia could be optimistic about its prospects if it put in place the right policy settings to take advantage of growth in Asia and the terms of trade boom.
Mr Swan said that since 2007 there had been 30 million jobs lost around the world, but in Australia 750,000 jobs had been created.
“(But) we are living in a very volatile international economic environment, underscored by events in Europe,” he said. It was hard to imagine Europe and the United States being drivers of growth over the next few years, but, he said, he was “more optimistic” about the US.
“The American consumer is not going to be a major driver of global growth in the future, but what we have in our region is really strong growth prospects,” he said, pointing to China, Indonesia, Malaysia, Vietnam and South Korea.
“The key for us is to make sure that through everything we do in our domestic policy settings we maximise the opportunities that come from that consumption boom which comes from the Asian century.”
He said the Australian economy faced sectoral and regional pressures, as well as an impact from the high Australian dollar.
“What we have to do is make sure we take the benefits of the mining boom and spread them as far and as wide across the economy as we can,” he said.
At a global level, Australia would continue to push, through forums such as the Group of 20 nations (G20), for all countries to move to market-based exchange rates, he said.
“If it doesn’t happen, what we may see is a reversion to protectionism and that will have consequences for Australia, particular our rural sector but other sectors as well,” he said. Andrew Liveris, chairman and CEO of Dow Chemical Company, one of the world’s largest manufacturers, told the forum a strong manufacturing sector could power jobs and growth. A single manufacturing job could create three to five jobs outside the plant, he said.
While a strong and diverse resources sector made sense in boom times, the downswings also needed to be managed, he warned.
“So, we need to build an Australian economy that is far less dependent on the prosperity, and indeed the consumption, of others, an economy that more global businesses want to come to, to invest in,” he told delegates via videolink from the US.
Mr Liveris said he was not playing down the importance of the resources and service sectors to the Australian economy.
“But it will also require, in my view, a robust, advanced manufacturing base – with high value products, especially those that use our natural resources and our human capital.”
The Reinvent would like to thank Herald and Weekly Times where this article first appeared