The executive director of The Australian Institute Richard Denniss recently called on Queensland Premier Campbell Newman to invest in Rockhampton’s manufacturing and agriculture sectors instead of mining for a brighter economic outlook.
Now, member for Keppel Bruce Young has come out blasting Denniss’s comments, saying they were baseless and had no grounds.
“I was surprised that Mr Denniss came out with those statements,” Young said.
“Having lived in Central Queensland all my life and having worked in mining, I was surprised at these comments.”
Young said the manufacturing and engineering industry within Central Queensland is dependent on the mining industry for its survival, The Bulletin reported.
“Had Mr Denniss contacted the manufacturing and engineering businesses in Rockhampton, he would have gauged a better view on the amount of work that they do for not only the mining industry but also the industries that service the mining industry,” he said.
“I agree there has been a downturn in the industry. I have seen the downturn of the mid ‘80s, the mid ‘90s and without doubt this is by far the worst that we’ve seen.
“One of the benefits that is coming to light is the offset by the employment associated by the coal seam gas and liquefied natural gas industries in and around Gladstone.”
A report by think tank the Grattan Institute said Australia’s manufacturing industry will grow as the mining boom wears off.
The report said trade-exposed industries like manufacturing and agriculture will gain from the mining downturn.
The Grattan Institute surveyed 16 countries whose exchange rate dipped as the mining boom ended. It found that “within three years, manufacturing exports as a share of GDP had risen by more than a third on average.”
"Therefore temporarily high exchange rates in economies comparable to Australia have not had long-lasting effects on export volumes and the added value of manufacturing.''
Denniss said last week Newman should boost sectors that create jobs if he wants to lower Queensland’s unemployment rate.
He said the premier should invest in long-term, sustainable sectors as the mining boom is not permanent, The Bulletin reported.
“This ‘future-proofing’ means strengthening long-term, secure industries like agriculture and manufacturing by limiting the amount of coal mines that are able to open in regional communities,” Denniss said.
“The mining industry wants you to believe that mining can co-exist with agriculture and manufacturing...But the more coal mines that are active in Queensland, the harder it is to attract investment in agriculture.”
Denniss added mining jobs were volatile and were dependent on many factors including the costs of mining staying low, wages remaining low, coal prices staying high and overseas demand staying high.
He also said mines shutting down bring their own share of difficulties.
“If in order to build a mine, a few farming jobs are lost, then by the time the mine ends its run, those farming jobs can’t come back and be filled by laid-off miners, because the business of coal makes the land unusable.”
But Young said an engineer at a conference told him manufacturing was in doldrums in Australia due to competition from Asia. China, India and other Asian countries offer cheaper labour prices.
“Manufacturing in Central Queensland services the local industry, the likes being agriculture, mining and construction,” he said.
“I wish to bring it to Mr Denniss’s attention that the resource sector’s contribution in Queensland is one in four dollars to the Queensland economy and employs one in every five Queenslanders.”
Australian Mining reported 90 jobs were cut at Mining Equipment Maintenance in Rockhampton, while ten jobs went at the company's MEM Engineering business in Mackay.
Mining equipment company Hastings Deering recently slashed 200 jobs across its Rockhampton and Mackay sites on the back of the mining slowdown.