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The Australian Government is manufacturing a new future for our nation. Manufacturing is critical to a modern Australian economy — a key part of almost every supply chain that adds significant value to all sectors.

This Modern Manufacturing Strategy (the Strategy) is led by industry, for industry, to help our manufacturers to scale-up, become more competitive and build more resilient supply chains. The Australian Government will be a strategic investor in this, in order to drive productivity and create jobs for Australians, both now and for generations to come.

Manufacturing is critical to national resilience and a vital part of our response during times of crisis. Agile manufacturing capability helps to secure essential items quickly. Manufacturing has been a key part of our nation’s COVID-19 response — from ensuring we have essential medical supplies through to producing enough food and groceries to keep supermarkets stocked.

Our local success stories are manufacturers that compete on value rather than cost alone. They have lifted their competitiveness and productivity by investing in new technologies, research and development (R&D) and effective business practices. However, when compared to similar economies, not enough of our manufacturers are scaling-up in areas that provide good returns. The Australian Government is committed to doing something about this. We can position manufacturing as a big income earner for the nation, harnessing our talent to support high value-add activities across a range of areas. It will create well-paying jobs and help restart the economy.

Issues faced by Australia’s manufacturers

For any business to succeed the underlying economic conditions need to be right. They need access to skilled and productive labour; low energy costs; a fair industrial relations framework; a competitive taxation system; efficient regulatory mechanisms; and favourable trade arrangements.

To drive growth and grasp new opportunities, businesses must also work on the business not just in the business. Focusing on the here and now prevents them from investing in new ideas that are seen to take too long — an issue exacerbated in the COVID-19 environment.
While technology is viewed as a great enabler and booster of productivity, the speed at which it develops or the uncertainty on how to apply it in their business limits adoption. A lack of connections can prevent them from reaching out to collaborate with scientists and researchers regarding their problems and to identify solutions.

Many businesses struggle to access the same economies of scale as global competitors given Australia’s big distances both in terms of remoteness from global markets, and large distances between urban centres.

The goal is for a partnership between Government, industry and the science and research community to develop manufacturing to deliver positive economic outcomes and create jobs.