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1301.0 - Year Book Australia, 2001  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 25/01/2001   
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THE EVOLUTION OF AUSTRALIAN INDUSTRY

Australia’s economic development has been one of contrast and change. In the early years of settlement, between 1788 and 1820, there was little scope for industrial or commercial enterprises. The government, as both main producer and main consumer, established workshops to produce the basic necessities of life - flour, salt, bread, candles, leather and leather articles, blacksmith’s products, tools and domestic items.

Between 1820 and 1850, the pastoral industry led Australia’s economic development, and by 1850 it was supplying well over 50% of the British market for imported wool. The growth in the wool industry brought great advances in the rest of the economy, with local manufacturing industries being established in response to new market opportunities. Gold surpassed wool as Australia’s major export earner throughout the 1850s and 1860s, resulting in a rapid expansion of banking and commerce. Increased public works activity during the 1870s played an important role in encouraging expansion in manufacturing.

From 1901 to 1930 manufacturing expanded further, with impetus from Federation and the elimination of customs barriers between States, and from the First World War. With the onset of the Second World War, the Australian manufacturing sector was sufficiently developed and diversified to respond to the demand for war materials and equipment. Key industries expanded and new ones developed rapidly to produce munitions, ships, aircraft, new kinds of equipment and machinery, chemicals, textiles and so on. After the war, all sectors of the economy experienced growth. The onset of the oil price rises in 1973-74 led the world into recession, and ‘stagflation’ (inflation coupled with slower growth in Gross Domestic Product (GDP)) affected all sectors of the economy. The modest employment growth between 1968 and 1979 was dominated by the service industries.

The 1980s and 1990s have seen a decline in the relative contribution to GDP from goods-producing industries and a rise in the contribution from service industries. The falling contribution from goods-producing industries is largely the result of a decline in Manufacturing’s share of GDP. The Mining, Manufacturing and Electricity, gas and water supply industries have all experienced declining employment, along with outsourcing of some activities, particularly support services.


Measuring Australian industry early last century

At the beginning of the century there was no comparable information on Australian industry, with little if any uniformity in the data collected and published in each State. The following excerpt from the the Official Year Book of the Commonwealth of Australia, 1901-1907 provides further background: “The want of uniformity in methods of compilation and presentation of Australian statistics renders it an extremely difficult task to make anything like a satisfactory valuation of the various elements of production. At present there is so little accurate statistical knowledge regarding such industries as forestry, fisheries, poultry and bee-farming, that any valuation of the production therefrom can only be regarded as the roughest approximation”. However, despite these difficulties, there were official estimates that in 1906 Agricultural production constituted 61% of total production, Manufacturing 21% and Mining 18%.


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