Australia's "service economy" and the future

[greggles]

The COVID-19 pandemic has revealed a lot of unfortunate realities about the state of Australia's domestic economy in 2020.

Now that we are all interested in "buying local" to boost the local economy the search is on to find goods that are actually produced locally in Australia from 100% Australian ingredients.

Good luck with that!

Australia is now a "service economy" and has been for quite some time. Manufacturing in Australia peaked in the 1960s at 25% of GDP, and has since dropped below 10%.

Our high wages have effectively made manufacturing goods here from local materials more expensive than importing similar goods from Asia. Entire industries such as textiles and car manufacturing have disappeared almost entirely. We have a vast land mass but import more of our food than ever.

But service jobs are starting to disappear too, all at the low end. Automatic checkouts, robots picking orders in warehouses. Companies are cutting costs by getting rid of humans where they can. At the same time, the cost of a university education is increasing dramatically.

Now that it seems that we have priced ourselves out of the global labour market, can we really continue to grow into the future as a service economy? Or are we rushing headlong into a serious employment crisis? COVID-19 has crippled the tourism, entertainment, and hospitality industries and we are suddenly on a knife's edge within a matter of months.

Have we all been fooling ourselves? What is the future for Australia's domestic economy?

 

[Knobby22]

Good post Greggles.

The future does look scary.

However, robots can be used in low wage countries also, and in effect lowers their advantage.

I think we have advantages in many fields. We should exploit these.

For instance we should be keeping some of our gas and selling it cheap, lowering energy costs that way.
We should be providing some protection against imports and avoid selling off our assets (including ports). We have a stable society. We have a good democratic system. We have pretty good infrastructure.

I am sure we could do OK but at present our mindset is a bit average.

 

[jbocker]

Excellent subject. This is something we really need to discuss. To pick up on one point

We have a vast land mass but import more of our food than ever.

I would suggest that this may be due to the broadening of our 'tastes' for different culinary offerings and skills. We have moved a long way from meat and two veges, and we also grow a much wider range of produce. Don't under estimate our potential here. What we need to fear is retaining ownership.
We have plenty of food potential as an industry..
https://www.australianmanufacturing...a-produces-enough-food-for-75-million-people#

 

[greggles]

I would suggest that this may be due to the broadening of our 'tastes' for different culinary offerings and skills. We have moved a long way from meat and two veges, and we also grow a much wider range of produce.

No, it's staples. Rice, fish, vegetables. Check the frozen fish at Aldi, the home brand rice and canned vegetables. For some reason it's cheaper to farm fish in Vietnam, process it there and ship it frozen to Australia than it is to farm it here.

The next time you are at the supermarket look at where everything is manufactured. You will be shocked.

 

[sptrawler]

The newspaper said this is going to create new jobs.

https://www.coastlive.com.au/news/local-news/autonomous-truck-training-centre-to-be-built-in-collie/

lol

 

[jbocker]

No, it's staples. Rice, fish, vegetables. Check the frozen fish at Aldi, the home brand rice and canned vegetables. For some reason it's cheaper to farm fish in Vietnam, process it there and ship it frozen to Australia than it is to farm it here.

The next time you are at the supermarket look at where everything is manufactured. You will be shocked.

Absolutely agree. We need to look for Australian and if it is not there, ask for Australian. You will have to pay more, we need to focus NOT on price. More people need to ask for it. To borrow some famous lyrics from John Farnham...

You're the voice, try and understand it
Make a noise and make it clear
Oh, whoa
We're not gonna sit in silence
We're not gonna live with fear
Oh, whoa

AND what boils my chops, it is not using the staffed check out. People say they want more employment yet queue up for self check out while a lot of check out stations are not staffed.

Another is catching local produce and shipping it overseas to get packaged, then ship it back to buy.

 

[Smurf1976]

No, it's staples. Rice, fish, vegetables. Check the frozen fish at Aldi, the home brand rice and canned vegetables. For some reason it's cheaper to farm fish in Vietnam, process it there and ship it frozen to Australia than it is to farm it here.

Frozen vegetables are one example.

You can buy the Chinese vegetables processed in NZ and which says "made in NZ" on the bag - technically correct since the bag probably was made there.

Or you could buy 100% Australian grown and processed.

Yes I choose the latter.

If you consider the range of climate we have in Australia well between the states we can grow just about everything really so no need to be importing food, all we need to do is move things around between the states.

 

[greggles]

If you consider the range of climate we have in Australia well between the states we can grow just about everything really so no need to be importing food, all we need to do is move things around between the states.

This is where we should be innovating. Better, more advanced food production methods. Tax breaks for anyone who grows food, irrespective of the size of the business. There are plenty of small players out there operating in niche food markets.

What we need is a federal government with vision. A government that looks past the next election and can start reshaping the Australian economy post COVID-19. We need to rely less on other countries and produce more here. Self sufficiency should be our goal so if something like this happens again our economy won't fall off the edge of a cliff. We need to be more economically resilient. COVID-19 has shown that we have a long way to go.

 

[pubski]

Top posts guys. Wish more Aussies would feel that way. Asian clients definitely appreciate our fruit and veg as well as meat/seafood. So much so that they are prepared to pay a premium over their local produce. They know the difference. From what I've seen at a typical grocery store checkout, most of us still don't.

 

[SirRumpole]

Some light at the end of the tunnel perhaps ?

https://www.abc.net.au/news/2020-06...uring-in-australia-after-coronavirus/12387448

 

[qldfrog]

Absolutely agree. We need to look for Australian and if it is not there, ask for Australian. You will have to pay more, we need to focus NOT on price. More people need to ask for it. To borrow some famous lyrics from John Farnham...

You're the voice, try and understand it
Make a noise and make it clear
Oh, whoa
We're not gonna sit in silence
We're not gonna live with fear
Oh, whoa

AND what boils my chops, it is not using the staffed check out. People say they want more employment yet queue up for self check out while a lot of check out stations are not staffed.

Another is catching local produce and shipping it overseas to get packaged, then ship it back to buy.

100%
I try to always use staffed checkout but getting harder and harder
Canned corn: China or Thailand..in Australia..really..so Edgell as last provider.asparagus...Peru vs China, but why not domestic.
Gerkhins..running away from Indian grown, but last try for domestic was not successful..double price and a single choice...
And this is with Aussie brand names
I still allow myself to NZ products, kind of brotherhood .a.Italia for tomato based products.
Fish: always check, rice, etc
We have lost everything but food, let's at least keep that..

 

[SirRumpole]

I still allow myself to NZ products, kind of brotherhood .a.Italia for tomato based products.

For your info Froggy.

https://ausveg.com.au/media-release...ables-from-china-and-sending-on-to-australia/

 

[qldfrog]

For your info Froggy.

https://ausveg.com.au/media-release...ables-from-china-and-sending-on-to-australia/

Yes the" and from imported ". ...
Used by Australian brands products but the new labelling if true should help

 

[PZ99]

I think it all comes down to better education and upskilling.

Manufacturing in the US was largely replaced by IT. But that won't happen here unless we invest in the relevant training required. Automatic checkouts and robots need constant servicing and upgrading.

 

[jbocker]

I think it all comes down to better education and upskilling.

Manufacturing in the US was largely replaced by IT. But that won't happen here unless we invest in the relevant training required. Automatic checkouts and robots need constant servicing and upgrading.

That's if you can find and afford a training spot, its full of imports learning inglish maffermattics and inginearing. Robots will have a lifespan equal to warranty period then ditch and buy a new one. Or maybe lock in a fixed venue service agreement.

 

[PZ99]

That's if you can find and afford a training spot, its full of imports learning inglish maffermattics and inginearing. Robots will have a lifespan equal to warranty period then ditch and buy a new one. Or maybe lock in a fixed venue service agreement.

Yep, training from investment. Robots need servicing and software upgrades through their lifespan.

Australia has a skills shortage of software developers and IT business / systems anal-lists

 

[PZ99]

One example > Amazon reveals plan to build huge robot warehouse in Western Sydney.

https://www.abc.net.au/news/2020-06...-robotic-warehouse-in-western-sydney/12406406

Minister for Jobs, Investment, Tourism and Western Sydney Stuart Ayres said the jobs on offer were "not the traditional warehouse jobs we've seen in the past".

"We are creating new opportunities for technicians, computer engineers, computer programmers and bringing more smart jobs to where people live here in Western Sydney."

Amazon has opened more than 50 robotics fulfilment centres around the world but this will be the first in Australia.

It will incorporate the company's latest robotics systems where robots move shelves to workers therefore reducing the amount of walking employees have to do and improving processing times

 

[Dona Ferentes]

robotics fulfilment centres ... the Ludovico technique?

 

[qldfrog]

To reheat a thread i can still access and more relevant than ever.
We keep hearing calls to bring manufacturing back in Australia, getting higher than the raw and agricultural material producer we are..and only that.
I had the priviledge to attend my son graduation ceremony at UQ last week.
In the engineering ceremony i attended, i can roughly say that 8 out of 10 graduates had Chinese /Asian names, 1 an indian name and the last one a European or Australian name.
We are talking a sample of around 200 graduates so significant
Knowing as i do the control and the opportunities available in Asia for graduates, there are low chances many of these will remain in Australia.
And if they do, many will be considered by BJ as oversea Chineses..which could be an issue
i was well aware of the absolute lack of capacities / opportunities in Australia but was really shocked by the abyssal number of "native" graduate in hard sciences.
After 15y of STEM for women promotion, i think this country only managed to discourage Australian boys..with no replacements.
Anyway, had to be told.
And no, it is not a racist post.the same problem could happen if Swedish were 80% of engineering graduates and were pissing off back home with their degrees

 

[Smurf1976]

After 15y of STEM for women promotion, i think this country only managed to discourage Australian boys..with no replacements.

Agree with the broad sentiment but I'll say that there definitely are some extremely capable women in the industry.

We need more regardless of gender.