How important is the mining sector to the Australian economy?

How important is the mining sector to the Australian economy?

Australia’s mining sector, which employs a high number of skilled overseas workers, is making a huge contribution to the nation’s economic and employment well being, according to research conducted by the Reserve Bank of Australia.

The report reveals that Australia’s mining boom has created about 500,000 jobs across every major industry over the past seven years and more than 1.1 million workers depend on the wider resources economy, particularly in the construction and manufacturing sectors. The central bank also says that while commodity prices are likely to drift lower over the next few years, Australia will continue to benefit from China’s economic expansion.

Resource industry employer group, the Australian Mines and Metals Association (AMMA) says the data from the RBA’s Industry Dimensions of the Resource Boom research paper should put to bed any demonisation of Australia’s mining, oil and gas employers. ‘The resource industry continues to be the fastest growing source of employment for Australians, having created 130,000 direct jobs over the past five years and 28,500 new Australian jobs in 2012 alone,’ said AMMA chief executive Steve Knott.

‘The RBA has now produced incontrovertible evidence backing what the industry has been saying for a long time, that the indirect flow on effects of the Australian resources sector have far wider employment and economic benefits than it is given credit for,’ he pointed out. ‘Trade unions should stop spending members’ funds on expensive political campaigns designed to mislead the Australian public on matters like the distribution of wealth and skilled migration,’ he added.

Quote from AustraliaForum.com : “There has been lots of talk about the mining and resources sector in Australia slowing down and the implications for overseas job seekers. Skilled overseas workers are sought after in the mining, oil and gas sectors but there have been concerns about the number being employed.”

The research also shows that the resource economy accounted for 9.75% of total employment in 2012 through flow on job creation in servicing sectors and three times more Australians are in employment due to the resource industry than first thought. The resource economy accounts for 18% of Australia’s gross value add, or approximately $250 billion of the nation’s annual output and total employment accounted for by the resource economy is estimated to have doubled since the mid 2000s.

‘Department of Immigration figures also show more than 92% of new jobs created in the resource industry are taken by Australian workers, debunking negative claims regarding the role of migration in the sector,’ Knott also pointed out. ‘The RBA has highlighted how beneficial a strong resource industry is for long term employment. As a nation we should be developing more effective policies to sustain these benefits, not stifling growth through heavy taxation and increased red tape,’ Knott said.

‘It’s now time to move beyond treating Australia’s resources investment as a temporary boom. Government needs to work cooperatively with industry to foster long term sustainability, increase our international competitiveness and get our productivity on par with other nations,’ he added.