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Prime Mover Magazine

Manufacturing growth continues

Australia’s manufacturing sector experienced a strong start to the year in January, according to data compiled by the Australian Industry Group (Ai Group).

The Ai Group’s Australian Performance of Manufacturing Index (PMI) increased by 2.5 points to 58.7 in January, indicating faster growth than at the end of 2017.

"Australia's manufacturing industry enjoyed a strong start to the year and added to the longest manufacturing expansion in more than a decade," said Ai Group Chief Executive Innes Willox.

"While production and sales volumes were robust and employment also grew, the combination of cost pressures – notably energy costs – and strong competition in part due to the recent rise in the value of the Australian dollar, continued to keep margins tight and restrain wage rises. Now is the opportunity for policy makers to reinforce the optimistic start to the year to secure further investment and employment gains in 2018."

The growth comes as Victorian manufacturing continues to go through a major period of transition following the end of passenger vehicle manufacturing.

Victoria’s manufacturing industry contributes $27.7 billion to the Victorian economy, is made up of more than 13,000 businesses and employs more than 286,000 people, an increase of more than 20,000 over the last two years.

“Victoria is Australia’s manufacturing and jobs powerhouse – backed by 12 months of consecutive growth,” said Minister for Industry and Employment Ben Carroll

“This growth means jobs for Victorians, and more opportunities for Victorian businesses.

“There’s a perception that manufacturing is dying, [but] it’s not, it’s evolving as more and more companies transform and digitise their operations for the 21st century.”

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