Western Australia’s rapid economic growth and falling unemployment have created a rare opportunity for the State to rethink its industry policy.
Western Australia’s rapid economic growth and falling unemployment have created a rare opportunity for the State to rethink its industry policy.
For the first time in a generation, unemployment has stabilised around 5 per cent, which is close to what economists call the ‘natural’ rate of unemployment.
A bigger concern now is labour shortages, which have become one of the main constraints on business growth.
For policy makers at State and Federal levels, the challenge is to sustain the current momentum rather than falling into the old ‘boom and bust’ cycle.
That challenge is particularly difficult in Western Australia, given the impact of big resource and infrastructure projects.
Many times in the past, the State has enjoyed a couple of years of breakneck growth followed by a sharp drop in investment and employment.
Building up the services sector, so that it becomes a bigger export generator in its own right, is one way of smoothing and sustaining economic growth.
Education, health, legal services and mining services are already export earners but their potential is even greater.
This week’s edition of WA Business News contains several articles that illustrate the opportunities for the Western Australian services sector.
Law firm Corrs Chambers Westgarth provides a good example of Perth-based lawyers taking a lead role on major transactions in the Asia Pacific region.
It advised South Korean steel company POSCO on a multi billion dollar liquefied natural gas (LNG) supply agreement with the BP-led Tangguh consortium in Indonesia.
In another field the Institute of Radiochemical Engineering provides a fascinating example of Western Australians leveraging the State’s strength in medical technology to create new commercial opportunities.
The institute is built around new cancer detection equipment acquired by the State Government and turns that cost into an opportunity to boost research, training and potentially generate export dollars.
Even bigger opportunities are likely to flow from the recently established Western Australian Energy Research Alliance, a joint initiative of CSIRO Petroleum, Curtin University and the University of WA.
The State Government has backed the alliance by providing $20 million over five years.
Woodside has already agreed to provide $25 million over five years, and other industry, government and education money is likely to follow.
All going well, the alliance will create valuable intellectual property that Australia can export to other countries.
Engineering firms such as GRD Minproc, Worley and Clough are also world class operators.
For Australia, the sustainable opportunities of the future lie in commercial activities that can compete in the world market, and education, legal and mining services should be at the forefront of that push.
Sports business
On a lighter note, we had fun this week looking at some of the State’s sports stars who have succeeded in the world of business.
Our list of ‘sporting suits’ on pages 14-16 is not meant to be comprehensive but illustrates the diverse business activities of our sports stars.
If you would like to add to our list, send suggestions to editorial@wabusinessnews.com.au
- Mark Pownall is on assignment in the US.
