Experts predict that the mining industry will remain an integral part of Australia’s economy over the course of the next five years, with companies expected to slash construction jobs and increase productivity.
According to a forecast made by BIS Shrapnel, the mining industry will make up 19.8% of the entire Australian economy in 2018, which represents a small leap forward on its 2013 figure equivalent to 18.7%, reports Brisbane Times.
Researchers predict that productivity will increase by approximately 41% during the next five years, but while operational jobs are expected to increase by 11% over that period, it is estimated that there will be a 40% slump in construction positions.
These numbers will see the creation of 20,000 new operational jobs, but also losses of around 16,000 construction jobs.
According to BIS Shrapnel infrastructure and mining unit senior manager Adrian Hart, the industry will continue to be challenged by lower commodity prices and a high Australian dollar.
“As such, they are going to extraordinary lengths to cut back on the high costs/low productivity culture which characterized the construction phase of the [mining] boom,” Mr. Hart said.
“With respect to the mining boom, it’s probably fair to say that this is not the beginning of the end, but the end of the beginning.”
Mr. Hart added that the evolution of the mining industry is certain to produce big winners and losers in Queensland.
“Iron ore and oil and gas will be the big front-runners,” Mr. Hart said.
“Queensland wins in a way, through the strong expansion of [liquefied natural gas] production over the next five years. On the other hand, Queensland is also facing the brunt of the biggest declines of investment.”
“The Queensland economy is going to face a shock over the next five years as it deals with that.”
Earlier in September BIS Shrapnel’s chief economist Frank Gelper predicted gloomy times for the overall Queensland economy on a short-term basis.
“Queensland is a diversified state, with agriculture, tourism and some service industries all directly affected by the dollar, so when it falls, that will underwrite increases in those areas,” Mr. Gelper said.
“While the mining sector has been booming and Queensland has been booming, those things were in recession. Now it switches.”
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