We all know the mining boom saved the Australian economy from the type of recession that many other countries experienced following the Global Financial Crisis.
But the mining boom is over, and unfortunately we didn’t make the most of it.In fact we’ll probably never another mining boom of that nature again and Australian now with manufacturing is on its last legs, what is going to our economy now?
That’s clearly an important question for us as Australians and even more so if you’re interested in property investment because its important to know where jobs growth, population growth and wages growth will be in the future.
SERVICES WILL DRIVE ECONOMIC GROWTH
It may surprise you to know that services that drive most of Australia’s domestic growth, employing nine out of 10 people in the workforce while accounting for 75 per cent of GDP.
Commodities like iron ore and wheat naturally come to mind when we think about major national exports.
But the fact that services, as measured by ‘value-added’ export earnings, has overtaken natural resources as our biggest export earner is almost unknown.
The services sector can help Australia seize the opportunity of Asian growth and solidify its place in the global economy, taking advantage of the trade liberalisation championed by the government through the South Korea, Japan and China free trade agreements.
Services account for 41% of Australia’s exports earnings when measured in terms of total value-added, compared with 37 per cent for mining and 23 per cent collectively for agriculture and manufacturing.
In the following video demographer and economist Brian Haratsis from MacoPlan explains the the role of the services sector to Australia.