Key Causes And Key Effects Of Australia's Manufacturing Industry Moving Offshore

Submitted By wah22wah
Words: 1410
Pages: 6
Open Document
“Analyse the key causes and key effects of Australia’s manufacturing industry moving offshore”

The Australian manufacturing industry has been facing crisis for many years. There is a huge cavity in the fiscal transactions effecting the upliftment of manufacturing industry, resulting manufacturing industries moving offshore. The key factors which are causing Australia’s manufacturing industry moving offshore are, import competition, and high cost of production in comparison to low cost economies, especially China. Local manufacturers are finding it difficult to compete with imported goods, as these goods are proven to be a decent substitute at a lower price. “The Australian manufacturing industry is facing increased import competition, particularly from China, and the imperative of pursuing exports has never been more pronounced” according to the Australian Chamber of Commerce and Industry, (2007, p. 24). The high cost of production in Australia is a phenomenal constrain which is decreasing the profit and interest of manufacturers. In accordance with ACCI (2007, p. 65) “Outsourcing has become a necessity for business to maintain a competitive edge, high cost structures make it impossible to be successful domestically or internationally as trade increasingly finds less resistance”. The major effect of this shift is unemployment. As Industry is moving offshore, the low-skilled individuals will find it hard to get another job. This essay will analyse two key causes and one key effect of Australia’s manufacturing industry moving offshore.

Firstly, import competition is one of the major causes forcing Australian manufacturing industry moving offshore. Higher value of the Australian dollar has made domestically produced products significantly expensive than that of the imported substitutes originated from low cost economies like China and India. The Australian Food and Grocery Council & A. T. Kearney Australia (2011, p. 24) report that “The recent currency appreciation has yet to fully wash through in terms of displacing domestic production with imports. As a result we expect that industry imports will continue to increase at a faster rate than historically observed”. Various domestically produced products are seeing decline in sales due to cheaper imported substitutes. Australian mattress manufacturing industry is going through unstable international trade due to import competition. As cited by Kelly (2014, p. 7) “Import penetration peaked at 24.1% of domestic demand in 2007-08 before plunging over the next two years, to 14.8% in 2009-10. Since then, the import share of domestic demand has gradually climbed to an estimated 16.5% in 2013-14”. The customer base is constantly declining for domestically produced products as compared to imported products, which is a result of the abundant availability of substitutes at a much lower price. China, Malaysia, Thailand and New Zealand are major eatables and grocery exporting countries to Australia. The growth rate of imports from these countries has risen to very high levels. As per the findings of AFCG & A. T. Kearney Australia (2011, p. 25) “China, Thailand, Malaysia and New Zealand have recently been the fastest growing food and grocery exporters to Australia. Imports from these countries have grown at rates between 8 and 18 per cent per annum between 2004 and 2009”. Import competition is one of the key causes which is limiting domestic manufacturers’ profit and compelling them to move offshore for better business output and greater market presence in Australia.

Secondly, high cost of production is taking its toll on manufacturing industry. Skilled and un-skilled labour is a core component of most manufacturing industries. Australia being a high wage country is facing hard times in the manufacturing realm, and that is a result of liberal reforms and the system of trade unions. Manufacturing sector has another financial burden, which is age pension. Unlike low cost economies,
Show More

Related Documents: Key Causes And Key Effects Of Australia's Manufacturing Industry Moving Offshore

Six Sigma and Phase Essay

the task was to minimize the fabric rework, rate of production can be maximizing. And project the minimization of fabric rough problem to reduce the total number of rework. They followed the DMAIC process within a framework. The five DMAIC phases and key tools used in each phase are listed of the process as given briefly as under. Phase I: D = Define - Pareto Analysis; Project Charter. Phase II M = Measure - Descriptive Statistics; Process Capability Analysis. Phase III A= Analyze -; Fish-Bone Diagram…

Words 911 - Pages 4

Tesco And Gillette: Shrinkage Reduction Project In Hungary

of stocks and customer friendly merchandising are key pillars of the Tesco strategy. • Business goals are severely challenged by the complex problem of stock loss. • Tesco is addressing stock loss to drive sales and improve profitability. Gillette Profile • Global manufacturer of grooming, portable power and Oral Care products including: – MACH3 and Venus – Duracell Ultra – OralB/Braun Power Assisted Toothbrushes • Tesco is a key customer, globally and in Hungary. • On Shelf Availability…

Words 787 - Pages 4

Amber: Risk Management Process Essay

Objectives of Risk Management 4 Benefits of Risk Management 4 Roles and responsibilities 5 Risk Management Governance Structure 5 Relationship with other processes 7 Key Process Steps 8 One: Communicate and Consult 9 Two: Establish the Context 10 Three: Identify Risks 11 Four: Analyse Risks 12 Five: Evaluate Risks 13 Six: Treat Risks 14 Seven: Monitor and Review 15 Risk Reporting 18 Risk Management Reporting Responsibilities 18 Risk Escalation…

Words 4198 - Pages 17

Developmental Psychology and Key Person Essay

CYPOP1-3.1 – Explain the benefits of the key worker, person system in early years settings Babies and young children’s development is closely tied to the quality of the relationships that they have with others and especially the key person within their early years settings. Usually babies and toddlers do no like to be separated from their parents or primary carer, and therefore it is important that babies and young children are supported by a key person in their setting who will act as a temporary…

Words 1148 - Pages 5

Advanced Project Management Essay

of a project Analyse the difference between leadership and management relating to projects Explore why organisations in different sectors need to engage in projects and consider different types of project Evaluate the importance and relationship of project and people management in achieving project goals. Demonstrate an understanding of external business environmental factors and how they may affect a project. Critically evaluate the concept of power and influence. Identify the key stakeholders for…

Words 6989 - Pages 28

tools analyse L5 Essay

and implementation support necessary. The tools and techniques most commonly used in process improvement are: • • • • • • • • • • • • • • • • Problem solving methodology, such as DRIVE Process mapping Process flowcharting Force field analysis Cause & effect diagrams CEDAC Brainstorming Pareto analysis Statistical process control (SPC) Control charts Check sheets Bar charts Scatter diagrams Matrix analysis Dot plot or tally chart Histograms DRIVE is an approach to problem solving and analysis that…

Words 2077 - Pages 9

The Pyramid Principle by Barbara Minto Essay

recommendation. The answer is your first key line point. In the main part you start with the answer at the top of the pyramid and answer all logical questions in the lines below. The technique forces you to provide only the information relevant to the question. When you are at the bottom of the pyramid you best pause and make summary before going on. Then you get back to the original question and you move horizontally from the first key line which you just summarised to the next key line. Some useful guidance…

Words 2056 - Pages 9

Nvq Level 3 Essay

Implement the Positive Behavioural Support Model 1.1 Explain how Positive Behavioural Support has been influenced by: • Applied Behaviour Analysis (ABA) • Social Role Valorisation (SRV) ABA is a scientific process of examining what causes and maintains behaviour, in order to bring about positive change. SRV promotes valued social roles for individuals who are socially disadvantaged, to help them get some of the good things in life. 1.2 Summarise current legislation and policy guidance relating…

Words 1684 - Pages 7

Essay on Semiotics And Identity Adtext Analysis Jeol Efthimiou Eftjy001

“Semiotics -provides useful tools for understanding and analysing adtexts – their meanings and the sociopolitical effects they produce. Using critical tools such as sign, signifier, signified, connotation, denotation, myth, representation, discourse etc., critically analyse three adtexts: discuss the ways in which meaning is made, as well as the possible effects of such meaning.” The purpose of this critical analysis is to compare and contrast three magazine adtexts using the understanding…

Words 1572 - Pages 7

Essay about Information and Software Technology Assessment: Networking Systems

processes when creating solutions 5.2.2 Design, Produces and Evaluates appropriate solutions to a range of challenging problems.5.2.3 Critically analyses decision-making processes in a range of information and software solutionsFinal Grade Final Grade 5.3.2 Acquires and manipulates data and information in an ethical manner 5.4.1 Analyses the effects of past, current and emerging information and software 81 81 technologies on the individual and society 5.5.2 Communicates ideas, processes…

Words 3381 - Pages 14