Perhaps most surprising has been the resilience in the quality of jobs generated by the manufacturing sector. The key indicators of job quality provided by the Australian Bureau of Statistics data are employment status and whether employees receive paid leave entitlements. In manufacturing, well over 80% of jobs are full-time, and the majority of these come with the full suite of employee benefits, including paid leave.
In other words, there has been a relatively low propensity to turn manufacturing jobs into less secure jobs through casualisation or the use of independent contractors. While these proportions have declined since 1993 – the sector has generally maintained a high proportion of standard jobs. Moreover, Jeff Borland’s analysis of ABS data shows manufacturing is now of roughly equal importance across all states, not just the traditional manufacturing heartlands of Victoria and South Australia.
We can compare this situation to the quality of jobs created in those industries that have been responsible for generating enough jobs to absorb Australia’s expanding labour force. The retail sector accounts for around 11% of the labour force – or 1.25 million employees. Of these just over half are employed part-time (50.8%) or receive paid leave entitlements (53.4%). In construction, while the overwhelming majority of workers are employed full-time, fewer than half receive paid leave.
All in all, the evidence overwhelmingly suggests the Australian manufacturing sector has, even in a period of decline, continued to represent a core source of economic prosperity for Australia – and should continue to do so. In short, it has outperformed many other sectors in terms of its contribution to Australia’s sustained economic performance and its capacity to generate quality jobs. It still produces around 6.5% of Australia’s GDP.
Does this mean there is a strong case in favour of ongoing government support in the form of protections and subsidies for the sector (notably the automotive sector)? In my view it does not. Protection will accompany the continued decline of manufacturing as it fails to respond to real economic forces that are signalling the need for change.
Nor does it mean government – or industry leaders – should leave the sector to limp along with no support or assistance in re-inventing itself.
The Australian manufacturing sector needs both market-based competition and concerted action from governments, industry leaders, unions and those cities and regions dependent on the health of sector for their future. This remains an issue that we have yet to fully grapple with. The sooner we do so the better we will be able to manage the transition without significant costs or unnecessary disruption.
The Centre for Workplace Leadership has received funding from the Commonwealth Department of Industry to investigate the diffusion of high performance work practices among manufacturing SMEs in Australia.
This article was originally published on The Conversation. Read the original article.
