100K manufacturing jobs at risk if gas prices continue to increase

High gas prices could spell the loss of more than 100,000 Australian jobs. Manufacturing Australia chair Sue Morphet told the ABC’s 7.30 program that if the federal government does not intervene to solve the gas shortage that has pushed up gas prices, thousands of jobs will be in jeopardy.

Australia is actually on track to become the largest gas exporter in the world, but we are experiencing a gas shortage that has led to increased prices for households and industry, 7.30 reported. The US has a system whereby gas is not exported unless it first meets a national interest test. The manufacturing industry has called for a similar system to be implemented in Australia.

Having survived the GFC, major companies are now under pressure to move their manufacturing offshore, Morphet told 7.30. “It could cost our GDP about $28 billion and 100,000 direct jobs, plus all the indirect jobs for people who service the manufacturing sector,” Morphet said.

A significant issue, according to CSR Managing Director Rob Sindel, is Australia’s decision to triple its gas exports. “Nobody quite understood that would mean there wouldn’t be enough gas available post-2016 to support local industries like this one,” Sindel said.

CSR says the rising cost of energy due to the cost of gas has forced it to close its Ingleburn plant and axe 150 jobs. “Factories like this, they just can’t support that additional impost,” Sindel told 7.30.

“The saddest part is the 150 people who worked here. It’s not only their jobs. Those 150 people supported a family, supported a community, and now they are out looking for employment.”

To view the 7.30 segment on the gas boom and its effect on the manufacturing sector, click here