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Dec 19, 2012

Stop singing those blue-collar blues: manufacturing jobs rise

ABS data shows the dynamics of the Australian workforce are changing -- good news at last for manufacturing, but bad news for public servants and construction workers.


Mining employment may have peaked while manufacturing is in surprisingly good health, some recent employment data suggests. Last week’s release of the ABS’s detailed employment data gives us a chance to see how the Australian workforce has changed over the last year, and over a longer period. It also helps bust a few myths peddled by the self-interested.

Compared to the November quarter in 2011, the economy added 112,000 jobs in trend terms (all of these numbers derive from trend data) over the four quarters to November 2012, almost exactly the same as in the comparable period in 2011, and well down on the 300,000 plus in 2010.

There were two big losers in terms of industries. Construction was one — construction employment declined 37,000 over the year to November, although it managed to add 3,000 jobs in the final quarter.

But the big loser was public administration: by the end of November, there were nearly 51,000 fewer public servants across the country than 12 months previously, compared to a growth of 40,000 the previous year. The biggest cuts were in NSW, which saw 27,000 fewer public servants, and Queensland, where 10,000 public servants lost their jobs. NSW looks to have completed its cuts: public servant numbers actually grew in the November quarter, whereas the Newman government in Queensland looks like it’s only just getting started.

The growth industries were mining, up over 28,000, although total numbers actually fell in trend terms in the November quarter, for the first time since 2009, mainly in coal and iron ore. Accommodation and food services added 26,000, professional services (one of our fastest-growing sectors) added 41,000. Australia’s biggest employer, health care and social assistance, had a comparatively quiet year, adding only 30,000 jobs, due to no growth at all in NSW and 5000 jobs being slashed from the health sector in Queensland.

And don’t be too concerned about retailing: the sector added nearly 8000 jobs, which isn’t much but in 2011 it actually lost jobs in net terms. And retailing’s problem is NSW — that’s the only state where retail employment fell significantly. Retail employment actually grew by 7% in Victoria across the year.

Most interesting is the case of manufacturing, which we are repeatedly told is in terrible strife, getting pounded by the strong dollar and in desperate need of assistance. During the year, that sector added 14,000 jobs and actually very slightly increased its share of the overall workforce, after decades of decline — it’s now around 8.4% of the Australian workforce. It’s too soon to declare the long-term decline of manufacturing over, but there’s far more to the story than what unions and manufacturing companies tell us.

Where is it growing? More traditional heavy manufacturing is in decline, yes — primary metal manufacturing shed 18,000 jobs, and fabricated metal manufacturing another 9,000. But food manufacturing — a sector that regularly demands assistance from the government on the basis of “food security” – put on 17,000 during the year.

Manufacturing is changing, rather than declining: the sector shed jobs in the traditional powerhouse of Victoria (and was flat in SA) but grew strongly in NSW, which now looks set to eclipse Victoria as the largest manufacturing state in employment terms, with 317,000 manufacturing workers to 283,000 south of the border.

But Victoria is powering ahead on professional services, with that sector growing by a remarkable 9.5% across the year, suggesting its manufacturing decline is being offset by the transition to services.

The overall trends in Australian employment, by the way, match those in the US. Healthcare and social assistance (bearing in mind there’s not a perfect correlation between US and Australian occupational categories) is nearly the largest employer in the US and is predicted to soon become the largest, despite the US having a much larger services sector that is also growing rapidly, while manufacturing is expected to continue its decline from its once-dominant role as an employer of American workers.

Let’s take a longer-term perspective and examine how the workforce looks at the end of 2012 compared to when the ABS first began compiling industry-level data, in the November 1984 quarter. This is how key sectors have changed as a proportion of the entire workforce over the last 28 years:

US trends suggests that by 2020, health care and professional services will continue to grow strongly as proportions of the workforce. But what if that huge collapse in manufacturing employment over the last three decades is finally over — if Australian manufacturing, in the teeth of currency-induced headwinds, has begun to turn things around?

Next year will provide us with some more evidence about its long-term prospects.


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26 thoughts on “Stop singing those blue-collar blues: manufacturing jobs rise

  1. مكينSultanofAustralisTerraNullius

    used to be so easy, to give my heart away
    i found out love, was no friend of mine
    playing to win, but you lose just the same
    so long, it was so long ago
    but i still, got the blue, for you
    as the dayz come and go, there is one thing i know
    that i still, got the blue, for you

  2. John Bennetts

    It’s well worth noting that agriculture and mining sectors appear as #9 and #10 out of 11, which is somewhat at odds with the amount of special pleading and public breast-beating from their spokespersons.

  3. Apollo

    Good to see the economy is transitioning not too badly. But we cannot be complacent about how things are right now though.

    Don’t forget that this year we have 230,000 people requested affordable housing. 44% of them were homeless (that’s over 100,000 people), many of these homeless people are victims of domestic violence, not all of them are mentally illed which the Greens often use to answer when people question about housing availability for asylum seekers but it’s best to leave that topic for another time.

    The rest of the 56% were under stressed, when losing their jobs and could not afford private housing rental. Here is where I think negative gearing has contributed to the problem, unlike those who argued that it made rent cheaper I think that it pushed prices up, and it needs to be reformed.

    One other problem is public housing run by the states are very inefficient and costly. They outsource auditors to audit the conditions of the properties, these people try to put in many things to be fixed and they can for whoever they are gaining profit from, hence many unecessary quotes and cost of fixing. Another issue is they often use cheap materials, and the tenants often have to call up to get things fixed. It’ll be best if half of the workloads are assigned to their own tradies and the other half outsourced, so you can measure competitive productivity and gage durability of the materials used.

    The politicians need to stop being complacent and spare some thoughts for the homeless this Christmas.

  4. Simon Mansfield

    >> food manufacturing?

    I hope this is more than people filling recycled jars with homemade organic jam for sale at the local produce markets to legions of tourists from the cities driving their imported SUVs.

    Without any details on wages and hours worked these types of sector descriptions are worth less than a tin of leftover baked beans from New Zealand – even if it’s still half full and only opened yesterday.

    What these numbers actually reveal is that the age of Peak Human is approaching faster anyone ever expected. And no one in government has a clue what people are going to do beyond changing the nappies of old people in nursing homes.

    The end of the social contract as we have known it for centuries if not millenia – will make dealing with climate change a minor issue.

  5. Scott

    Peak human? Seriously?

    People will do what they always do. Trade. Find a job. If they can’t find a job, they get educated. Change careers, Start their own businesses. Create new jobs. Move to new areas. Move to new countries. Things humanity has been doing for thousands of years.

    As long as there is not too much of an incentive for them to do nothing (i.e pensions/unemployment benefits), the human can be extremely resourceful in its desire for a better life.

    I think we’ll be fine.

  6. Simon Mansfield

    Enjoy the age of robotics Scotty – our society is entering a period of change in the next 100 years that will dwarf the last 1000 years if not the last 10000 years.

    I think we’ll be fine as well – but it’s going to be a very rough ride getting there.

    The value of work is central to our concept of self worth and it’s what glues our society together. But the need for human workers is eroding quickly and will speed up dramatically by mid century.

    Managing that transition is going to be the biggest issue facing humanity this century – not climate change.

  7. Simon Mansfield

    (BTW Scott – I’m not inferring you regard climate change as an important issue or not)

  8. Hamis Hill

    Regarding the large problems properly highlighted by Scott and Simon, could Issac Asimov’s “Foundation” trilogy, (also focussing on disaster), which proposes a new science of “Nexus”, show a way to overcome specialised knowledge experts’ notorious inability collaborate to solve any large problems? The Biblical tower of Babel comes to mind as an example
    The “Nexists” (referencing ‘connections’ between the various knowledge disciplines) draw upon wider knowledge bases to solve the problems.
    The new science of complexity argues that, indeed all disciplines are connected, with mutual effects upon each other that the old tactic of specialisation fails to recognise.
    Might be called, with the help of the NBN and internet, the New Age of Re-Enlightenment.
    Asimov was a fine teacher of science in his other works aswell.
    Perhaps we need an internet based institute of continuing adult education.
    A common starting ground might be the findings from the original Age of Enlightenment, which were aimed at a wide audience and came before the fetish for specialisation, which Asimov held responsible for the Anthropogenic difficulties described in his Foundation Trilogy.
    As Apollo says there is no room for complacency.

  9. Simon Mansfield

    In Asimov’s Foundation as in where it links back to the Robot series – the robots are effectively all destroyed in a wave of revulsion by humans in the near future. This was of course a critical part of the movie rendition of I.Robot.

    Throughout most of Asimov’s robot books the confrontation between human and robot is a central theme, a concept that is central to much of science fiction such as ‘Do Androids Dream of Electric Sheep’ (aka Bladerunner) and the various short stories that eventually inspired James Cameron to write the original screenplay for Terminator – and which is now being played out in real life in the UAV/Drone Wars of Afghanistan etc etc.

    It would be good idea if all our elected leaders were quizzed on their reading of science fiction.

  10. Hugh (Charlie) McColl

    Simon, I bags you quiz Barnaby Joyce.

  11. Person Ordinary

    Gee, there are some delightfully optimistic views here …

    And, If you allow yourself to ignore how vulnerable and short-sighted our economic system really is, and if you under-estimate the cumulative impact of climate change induced crises, such sci-fi fantasy futures seem possible.

    On the other hand, we may be struggling to maintain an electricity grid, in the midst of social and political chaos, let alone build armies of robot workers.

    Fantasy is great fun, sure. But let’s not get lost in it …

  12. Hamis Hill

    It’s pretty ordinary to confuse fiction with fantasy, and very much liable to become completely lost while in possession of this sort of critical faculty.
    Pretty ordinary.
    Didn’t that fantasy physicist Albert Einstein say that knowledge is nothing and imagination is everything?
    No knowledge and no imagination makes for an almost total intellectual vaccuum.
    Nothing there to add to the debate.
    Pretty Ordinary.

  13. Person Ordinary

    Yeah. You are probably right. Let’s do nothing but just wait and see …

  14. Simon Mansfield

    PO – you missed my central point.

    I said it was the social transformation being driven by a new economic system based on large scale automation – both hardware and software – and the end of human labour being central to our social contract that was the most critical issue we face.

    It will take a major effort by future society to manage that change. And compared to climate change it will be a much bigger and more difficult issue to navigate our way through.

    Climate Change is not an overly difficult problem for human technology to deal with. Chances are the same types of people who say the Y2K issue was a fraud will say the same about climate change – 50 years from now – if we make the changes needed to avoid the problem becoming overly serious.

    But that very technology will radically change our current economic systems and those issues are being ignored by virtually every government and think tank on the planet.

    However, I do actually agree with Scott that we will deal with it and the 22nd century will be an amazing time to be alive. Getting there though will be quite rough for a good section of humanity.

    Most science fiction is actually quite dark in its ideas about future history. Only a small section is pop science for the Jetsons.

    Sadly though, the orgy of fantasy fiction that came out of Dungeons and Dragons has suffocated the classics of the 1950s and 1960s that did a fine job at describing the world of today and the near term future.

  15. Person Ordinary

    “Climate Change is not an overly difficult problem for human technology to deal with.”

    I agree that we already know what to do.

    But all the evidence, and the trends underway, suggest it is already too late to act to mitigate the first few waves of impact from knocking our delicate economic system off its balance.

    Then it is only a matter of waiting for the next shock, which may not have been fatal without climate effects, to compound into immediate collapse. It may be a spike in food prices, from drought to bad biofuels policy, a series of storms, a banking crisis, a bubble bursting in Chinese real estate, a conflict somewhere, an oil trade embargo, … a million possibilities …

    To presume both that 1) climate impacts can not and will not knock the world economy off its precarious perch, and 2) that none of these other triggers will occur, is surely fantasy. No?

    To presume that a collapse in the global economic system, and so the trade in energy and food in particular, will not necessarily lead to collapse of political and social systems is just as fanciful. There is so much evidence in history.

    The “social transformation” you imagine requires a stable continuation of the old system as its foundation, but that old system is increasingly unsustainable.

    Nothing is certain of course, and this rather bleak view could be overstating the risks, but it is needed to counter the overly optimistic or ignorant presumptions that seem to permeate the debate.

  16. Simon Mansfield

    Most of the Paleo record suggests 1-2 degrees of warming will be on balance a positive rather than a negative. Especially given it should stop the next ice age cycle having any chance of taking hold again.

    Most of the negative scenarios you mention are nothing compared to what happened in the first half of the 20th century.

    Energy technology is rapidly advancing. Solar energy will be ubiquitous. Biofuels will be manufactured like beer, and fusion powered mega machines that suck out the carbon will be here soon enough and along with GM trees and negative carbon biofuels will clean up the excess carbon by the end of this century.

    100 years from now the science will just as likely be saying stop decarbonizing below 350ppm lest we cool down too much.

    Again the big issue is what are people going to do for work, money and social inclusion if automation is the general state of our economy. 3D printing over the next 20 years will decimate traditional manufacturing systems – with some estimates of up to 1 billion jobs being made redundant. While software automation and voice will put an axe through the Indian and Philippine call centre industries. The near term social implications of these and other like developments are being ignored by governments and think tanks all over the world. Civilization is not facing a crisis of limited supply but rather the opposite.

  17. Scott

    While I don’t want to dwell on climate change as an issue, the reason there is no action on it is that the average person doesn’t believe we are at crisis stage.
    So far (to 2011), the average world temperature is 0.8 degrees above the pre-industrial averge (which is recorded as the average between 1880-1910). So in 100 years or so, we have increased temperatures at 0.008 degrees a year.
    During that period, the world has experienced one of it’s greatest period of prosperity and advancement combined with increases in health and education outcomes, particularily in the developed world. Most of this has been due to technology driven by inexpensive energy. Is it any wonder people, especially the west, are reluctant to change a winning formula?
    When an actual “tipping point” arrives (no evidence of it yet), I’m sure humanity will get excited (even the skeptics don’t have a death wish), but until that happens, responses to climate change will come down to ideolgy. You either want to buy a climate insurance policy for the entire world, even though there are a lot of free riders, due to some sort of rich person’s guilt trip (hello, the left), or you want to kick the can down the road, continue our love affair with cheap energy, get rich and wait until the threat is more certain before acting (hello, the right).
    Like most things, the middle ground is probably where the truth lies.

  18. John Bennetts


    One moment, please.

    When an actual tipping point comes, as you so cavalierly note, then the future of the world will be beyond human control. Yes, there will be excitement, as you also happily state, but at the core of it will be realisation that the time for effective action has passed and the (perhaps) collapse of life in acidified oceans will progress to completion, or (perhaps) methane and CO2 from melting tundra will accelerate without hope for correction.

    They are the two most fearful potential tipping points that I am aware of, and there is substantial evidence of the approach of both, despite your affirmation to the contrary. Are you blind?

    They are possible, even probable, perhaps already emerging.

    They will be catastrophic. Of this there is no doubt.

    There will be no “middle ground” for you or your descendants to search for “truth”, as whatever remains of industrialised society and civilisation collapse – perhaps into war-fuelled anarchy.

    There can be no easy way back from a tipping point. It took 70 million years for life forms equal to dinosaurs to emerge after a previous tipping point. Is that what you favour?

  19. Scott


    I’m glad you have added the “(perhaps)” because that pretty much sums it up for me.

    No one knows anything about tipping points because the whole concept is pure speculation.

    My descendants will be there in the future, like yours. Which ever way the climate goes, they will probably be having a GM wheat beer together in a city bar in the biodome, or talking rubbish over an organic malt in a country pub.

  20. Person Ordinary

    Wow. The smug complacency is profound. It is disturbing, if not outright frightening, to see this from someone clearly so articulate.

    What hope have we got if Scott is right, and I think he is, that “the reason there is no action on it is that the average person doesn’t believe we are at crisis stage” – and if even those with intelligence can hide in denial?

    This is not a technical or technological issue. It is a political issue, and without a concerted effort by those capable of bringing more of the public up to speed, the required political will for effective action will never be achieved.

  21. John Bennetts

    The “perhaps” refers to which tipping point, not to specific tipping points. I have no doubt that our present trajectory leads to catastrophe.

    Others may gain temporary solace from their lack of concern/knowledge/etc.

    What will be, will be.

  22. Scott

    Don’t be frightened, PO. It’s just that we have different views on what is best for the world and it’s people.
    You would prefer to spend money now, hopefully stopping a perceived threat to the future that, regardless of what JB says, has a fair degree of uncertainty to it.

    As for me, I would prefer to continue to increase the standards of living of humanity (by both developed and developing nations alike). To use our access to cheap, plentiful energy (like coal) to continue our research and technological advancement, so the next generations will be in the best position possible to make the decisions if the threat of an increasingly hotter world becomes more certain. After all, they will be the ones that will be facing the threat rather than us who will be long gone.

  23. Hamis Hill

    It has been along time, but that second Asimov book described a catastrophe and a way to escape that catastrophe.
    It centred upon preserving the world’s knowledge as the world sank into a new dark age of ignorance.
    The Burning of Alexander the Great’s Library in Alexandria by Christian Zealot’s, of the sort presently infesting the Opposition Front bench, led to a thousand years of backwardness which ended with the Reformation.
    Asimov had plenty of historic events to inform his fiction.
    Some of it might be useful in the new scriptoria mimicking those of Prince Columba’s which dragged humanity out of the dark ages.
    That tower of babel where people learned to misunderstand each other seems like a good match for the present circumstances.

  24. Person Ordinary

    Nope, Scott, still frightened by the self-assuring tone, dare I say self-deluding? Let’s see …

    “we have different views on what is best for the world and it’s people.” – how about in the medium term, protecting humanity from the horrors that would play out as our system collapses, and in the longer term, ensuring the sustainability of life on Earth? You choose different values?

    “You would prefer to spend money now” – money, pfft. Is that your unstated concern? It doesn’t need money to change policy, just political will. And all the studies show it is cheaper to act sooner rather than later, if you really want to look at life, the universe and everything in such crass and narrow terms.

    “a perceived threat to the future that … has a fair degree of uncertainty to it” – maybe uncertainty in the actual sequence of events, but not in the catastrophic nature. Don’t you read the science?

    “our access to cheap, plentiful energy (like coal) ” – it is only cheap because we do not put a value on what economics classify as “common goods” like the atmosphere. The economic theory that underpins your presumption is one of the main causes of our dilemma.

    “research and technological advancement” is dictated by financial incentives. At present, the incentives dictate a continued reliance on fossil fuels. Don’t kid yourself that technology can or will advance without a major change in political will.

    “so the next generations will be in the best position possible to make the decisions … (we) will be long gone” – wouldn’t that be comforting? Read previous posts – any of the triggering events could happen tomorrow. (And the idea that none of them would occur in say the next 5 years is absurd.)

    I am not trying to shake you up – you are free to be warm and cosy in any belief you choose. I am just trying to suggest to others that your contribution may be exactly that – self-serving belief. Cheers.

  25. Hamis Hill

    Manufacturing in the aftermath of the “Coming Abbottt Recession”- heating a sharpened stick in a fire.
    Wait? manufacturing a fire is just too technical for the Abbotteers.
    All those “tech heads” , thwarting the will of Zeus by evilly exploiting “stolen fire from heaven”, are what has, in just a few short generations, brought the world to anthropogenic destruction.
    So no manufacturing then, just as well!
    The Cains of the coalition survivors, piously denied any evil manufacturing capacity, can just bop Abel on the head with a rock and, chimpanzee style, (no tools allowed, now) dine on the sweet and juicy livers (Come now, those god-given sharp teeth are all you need). Abbott’s new garden of Eden, post-recession, where tech heads are breakfast.
    Just exactly the right punishment for all those number crunching deceivers who led the little lambs astray!

  26. David Hand

    Happy new year.
    The level the global temperature rises to is being decided by the governments of China, India and the United states. So what if Scott retains an optimistic view of mankind’s adaptability?

    I share the views of some expressed here that science fiction writers expand our thinking about how humanity behaves under certain conditions. Asimov’s vision of a tired and decadent civilisation collapsing on itself has many historical examples but I don’t think we are at that stage in 2013.

    I am also optminstic that humanity will survive the growth of robitics and the elimination of many current forms of work because we have already done it. The industrial revolution was a huge change that started us on an unprecedented period of growth and wealth creation that is nowhere near ending. Robotics is just the next stage.

    We’ve put too much carbon into the atmosphere along the way but we can fix that too.


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