Australian manufacturing output grew 3.5% in 2011, according to new Reserve Bank of Australia figures.
Gloom surrounding manufacturing job losses and closures masked the fact that Australian high-value manufacturing expanded much faster than GDP growth, economist Paul Bloxham of HSBC Global Research says.
“There are parts of manufacturing that have been really struggling, and parts that are doing fairly well,” Bloxham said. “Manufactured exports are up overall.”
He said exports of scientific materials and specialised machinery had risen.
Bloxham said the weakest groups were ‘low value-added’ manufacturers who were likely to employ the most people.
“You are seeing the high-value-added manufacturers that have less employment are doing better,” he said.
“It makes a lot of sense as the low-value-added parts of the manufacturing industry are likely to be the ones that are less able to compete with the rest of the world because of the strength of the Aussie dollar.”
The seconded biggest manufacturing export economy in the world, Germany, has the strong Euro currency – much higher than the Australian dollar.
See the full RBA statement here.