On Tuesday, I reported how the Q1 national accounts, released last week by the Australian Bureau of Statistics (ABS), showed that Australia’s manufacturing sector shrank to a record low 5.1% share of GDP:
As you can see, Australia’s manufacturing sector has collapsed over the past 45 years, from around 14% of GDP in the mid-1970s. The shrinkage in manufacturing has been driven by a combination of falling tariffs, the rising Australian dollar in the 2000s in response to the commodity boom, and more recently, soaring energy costs.
These factors have made Australia’s manufacturing sector less competitive against imported goods and in export markets.
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