Victoria’s manufacturing sector records 12 months of growth

Victorian manufacturing has always been the heart of Australian manufacturing and a keystone of the Victorian economy.

Manufacturing in Victoria is now a $27.7 billion industry, delivering jobs, high-quality exports and substantial economic growth.

It is home to more than 13,000 businesses which employ 286,000 men and women – making it one of the state’s largest providers of full-time jobs.

Despite being an industry in transition, manufacturing in Victoria employs 8.8 per cent of the state’s workforce and is responsible for almost $18 billion worth of goods exports.

And the future still looks bright.

Defying expectations, the manufacturing sector is expanding, helping to support jobs, exports and economic growth.

Latest industry figures from the Australian Industry Group show that that Victoria’s Performance of Manufacturing Index has expanded for 12 consecutive months to February 2018 – the longest run of expansion since 2003.

This growth comes as Victorian manufacturing continues its transition towards higher value goods and services, which further underscores the importance of planning ahead for the future of manufacturing.

Victoria has the right elements to build a strong future in advanced manufacturing, including a highly skilled workforce, well connected supply chains, exceptional design and engineering expertise and world-leading education and R&D capabilities. Manufacturing’s resilience, diversity and strong performance also reflect the effectiveness of Victorian Government initiatives, such as the Future Industries Manufacturing Program and the Local Industry Fund for Transition.

Collectively, the government’s programs to support manufacturers are expected to create over 3,500 jobs and result in over $1.2 billion in private investment.

In addition, the Victorian Government released its Advancing Victorian Manufacturing –  A Blueprint for the Future in August last year. This statement sets out a clear vision for the state’s manufacturing future.

The Advancing Victorian Manufacturing statement showcases the state’s existing advanced manufacturing capabilities and outlines plans and actions to grow Victorian advanced manufacturing businesses.

It identifies strategies to make Victoria a leading hub of internationally competitive manufacturers that are creating value from design, engineering, data and services to generate opportunities and create jobs for Victorians.

This blueprint is backed by $12 million in new initiatives to help manufacturers grow.

The first of these initiatives – the Boost Your Business program – is offering Advanced Manufacturing vouchers to support manufacturers to develop new products, expand their capabilities and grow export opportunities.

The Victorian Government also supports manufacturing through procurement as part of its Local Jobs First – Victorian Industry Participation Policy.

A minimum local content commitment of 60 per cent has been applied to the manufacture of 65 high capacity metropolitan trains being built in Victoria and 82 per cent for their maintenance. Similarly, 60 percent has been set as the minimum local content for the manufacture of the new metropolitan buses, and 86 percent for maintenance.

Other projects with significant requirements for manufactured products also have notable minimum local content requirements, including the Victorian Renewable Energy Targets auction, with 64 per cent for new facilities, including 90 per cent local steel.

This will create enormous opportunities for local supply chain companies and create thousands of local jobs, including much needed work experience and training for apprentices, trainees and cadets.

The closure of the major car manufacturing plants was heralded as a death knell for Victorian manufacturing.

The phenomenon, however, has been an inspiring incentive for change.

The growth of advanced manufacturing has defied expectations and currently presents a dynamic picture of the road ahead for Victoria’s economic future.