Resource industry employer group AMMA says a report from the Australia Institute that downplayed the importance of the mining sector to the national economy is “riddled with errors and flies in the face of common sense”.
Research organisation the Australian Institute released the report today, which it said contained proof the mining industry contributed to Australia’s rising unemployment figures.
The benefits of the mining industry had been a "mixed blessing" for the economy overall despite Australia receiving a surge in national income, report authors David Richardson and Richard Denniss said.
"Strong world demand for Australia's minerals have driven up the exchange rate which, in turn, has reduced world demand for our manufactured and agricultural goods as well as for our tourism and education export services," the report said.
Australia's dollar has traded above $US1 for most of 2011 due to demand for the nation's resources, particularly iron ore and coal, and a weak US dollar.
The currency is trading around 45 per cent higher than its long-term average between December 1983 and August 2008.
The mining boom has also lifted the costs of skilled labour in other sectors, increasing the prices of materials used in mining and raising the costs of services such as construction.
AMMA director Minna Knight said the report could be easily discredited by economic research organisations such as the Reserve Bank and Deloitte.
“It claims that more than 80 per cent of the revenue generated by mining ends up in foreign hands yet the Reserve Bank said last month that 60 cents in every dollar earned from mining stays in Australia,” Ms Knight said.
“The report also says the industry pays 13.9 per cent tax whereas Deloitte Access Economics figures show the industry pays 41.5 per cent tax.”
Ms Knight said the Western Australian and Queensland resource-dominated economies led the country with growth of 2.3 per cent and 1.8 per cent, respectively, over the last quarter.
“In Queensland alone, capital investment this year has been 52.5 per cent higher than last year and State Treasurer Andrew Fraser has explicitly attributed this growth to the mining boom,” said Ms Knight.
“Furthermore, Australia’s unemployment rate has today risen to 5.3 per cent while the mining sector is experiencing a critical skills shortage. WA is calling out for 60,000 workers to meet current project requirements, while the Queensland Government today said the mining industry would provide 38,000 jobs across the state over the next few years.
“It’s easy for a leftist organisation and the Greens to make statements based on a general survey of public perception, but it’s far less convenient for those critics of the mining sector to face up to the statistics and hard facts that show Australia is prospering on the back of its resource industry.”
“It’s equally disturbing that such organisations are continuing their attempts to create an ‘us versus them’ attitude by portraying the mining sector as elitist or unproductive, when in reality the booming resource industry is working alongside all other industries to restore Australia’s economy as one of the most diverse and prosperous in the world.”
ABS statistics show 213,200 people are directly employed in mining, oil and gas operations in Australia, with an additional 639,600 indirect jobs created by the resource industry.
Greens Senator for Western Australia, Scott Ludlam, held a different view to the AMMA, saying the paper made it clear the mining industry was dodging its social responsibilities.
He said the mining boom was pushing up the cost of living for those not involved in the sector.
Mr Ludlam said the research ultimately illustrated a need for the nation to manage the mining boom appropriately.
