none

Aussie industry needs more than a weak dollar

31-08-2010
by 
in 
Aussie industry needs more than a weak dollar
The weakening Australian dollar has given the embattled manufacturing sector – particularly exporters – some much-needed respite.
 
The dollar is now hovering around US.92c – its lowest level in nearly three years. But while many manufacturers have collectively blown a huge sigh of relief – there are still many challenges ahead.
 
Australia remains a high cost country and struggles to compete with its low cost Asian neighbours.
 
Ford’s decision to close its Australian manufacturing plants rams home this point.
 
When announcing the decision Ford president Bob Graziano said: "Our costs are double that of Europe and nearly four times Ford in Asia."
 
In other words, manufacturing Ford vehicles in Australia is not a viable option.
 
It’s not just the strong Australian dollar that has put pressure on the sector.
 
Manufacturing is being strangled by government red tape and regulatory duplication.
 
Businesses are struggling to cope with high costs, including rising unit labour costs and steeply rising energy costs.
 
All of these issues have reduced the competitiveness of Australian companies.
 
If that’s not enough, a recent AiGroup survey of 330 small business owners found that IR reform is their biggest concern.
 
Almost a quarter (23.1 percent) said more flexible IR policies would greatly assist in boosting productivity.
 
Recent changes to the Fair Work Act have made it increasingly difficult for business to operate effectively.
 
Unions bitterly complained that the Howard Government’s controversial
 
Work Choices laws were slanted strongly in favour of employers.
 
Under the Gillard/Rudd Labor government, following strong union pressure, the pendulum has swung back in favour of the worker– much to the
detriment of many small businesses.
 
The AiGroup now rightly argues that urgent changes are now needed in a number of key areas to provide greater flexibility to employers and to “rebalance” the current “excessive weight” given to union interests.
 
Manufacturers are now looking for genuine commitment and action in this area from the next government.
 
The future of Australia’s manufacturing sector depends on it.

Related news & editorials

  1. 19.06.2019
    19.06.2019
    by      In
    I must admit that I’m not a massive fan of Australian politics in particular or in any kind of two-party system. And populist election victories around the world in recent years suggest that I am not alone in this sentiment.
    One inevitable problem of the duopoly appears to be the continual fighting... Read More
  2. 18.04.2019
    18.04.2019
    by      In
    Kermit the Frog may have famously said (and sang) that it isn’t easy being green. However, it seems that in 2019 Australia green may well be the new black.
    Politicians of all shades seem to have finally appreciated that the Australian public really does care about the environment, with climate... Read More
  3. 11.04.2019
    11.04.2019
    by      In
    It wasn’t until we decided to expand Industry Update’s coverage of security matters, and in particular cybersecurity, I didn’t realise quite how scary this business is. And I’ve come to the conclusion that the only hope is to close down the Internet altogether and go back to pen and paper.... Read More
  4. 01.03.2019
    01.03.2019
    by      In
    The Federal Government’s instant asset write-off scheme is certainly one of the most “small-business-friendly” measures ever introduced in Australia. But, remarkably, it is also badly misunderstood: recent research by American Express showed that almost half of all small business owners (47%) were... Read More