The Longevity Economy
Thursday, 1 May 2014
Author: John Spoehr, The Adelaide Review
Lets not mince words - Australian manufacturing is in recession with many more jobs to be lost in our most vulnerable regions as the automotive industry shuts down over the next three years. Nothing less than transformation of the industry is necessary to ensure its sustainability and viability over decades to come. At the same time downward pressure must be exerted on the Australian dollar to make our goods more competitive in global markets.
Manufacturing is a foundational industry in modern economies. It is where great value can be added to commodities, deep knowledge and skills are acquired and transferred to other sectors. Export of commodities and services alone is not a formula for economic success in the 21st century. We must also design, engineer and build knowledge- and skill-intensive goods by aspiring to be a world leader in advanced manufacturing. That great body of design, engineering and manufacturing skills accumulated over the last 50 years must now be dedicated to this task for the benefit of tens of thousands of Australian manufacturing workers and their families.
Estimates of the potential social and economic losses flowing from closure of the automotive industry are sobering. Recent modelling of closure impacts by the National Institute of Economic and Industry Research for my Centre at the University of Adelaide provides some insights. Around 200,000 jobs are at stake nationally and 24,000 in South Australia. These numbers are large because we are set to lose not just three major companies but much of the automotive supply chain and the demand that it generates for goods and services throughout the economy - an estimated $29 billion hit to GDP. Efforts to moderate this would have to be on a very large scale, which is increasingly unlikely. The Federal Government contribution to any closure recovery assistance package will probably be less than $100 million. It really needs to be 10 times that.
To view the full article on Page 13 of the May 2014 Issue of The Adelaide Review visit: http://www.adelaidereview.com.au/issues/document/may-issue