A recent report from the Australian Chamber of Commerce and Industry-Westpac has highlighted impending supply shortages and escalating costs as the major challenges Australian manufacturers will face in the next 50 years.
Andrew Hanlan, a senior economist in Westpac, said the ACCI survey showed that business conditions are expanding and have gained momentum in the previous quarter, but noted that shortages in labor and material, as well as an energy crisis, have led to skyrocketing costs.
A total of 51.7 percent of survey respondents indicated that labour was harder to find in the June quarter, a massive increase compared to 26.3 percent in March and 5.7 percent in 2021.
Australia’s manufacturing industry is benefiting from the rebound in activity with the reopening of the country’s economy. However, ACCI Chief Executive Andrew McKellar warned that the sector’s recovery risked being impeded by soaring input costs.
“Notwithstanding significant pressures, manufacturers are absorbing cost increases where they can. However, with more than 50 percent of manufacturers anticipating that costs will continue to climb, higher consumer prices should also be expected, threatening to stoke inflation,” McKellar said.
