Published in the September 2008 Australia’s Mining Monthly
While coal and winemaking are still highly important, tourism, technology and manufacturing are growing in importance.
Despite immediate concerns over some slowing in the economy, which is part of a New South Wales-wide trend, the long-term indicators remain strong.
Hunter Economic Development Corporation chairman John Tate points out that employment growth over the past 10 years has shown a strong upward trend. Total employment rose from about 230,000 in December 1997 to 296,000 at the end of last year.
Historically, unemployment in the Hunter was a few percentage points higher than for NSW as a whole. However, for much of 2007, the local unemployment rate was less than the state average.
Tate said that it was in this context that the regional economic development strategy needed to have a scope beyond job creation as well as a longer timeframe.
The corporation has helped devise the Hunter Vision, a 20-year plan that aims to provide direction in the growth of the regional economy. This would involve improving the flow of human and financial resources in the region and identifying actions required to address priorities and challenges in economic development.
The general growth in employment has occurred in 13 of the 18 economic sectors, with an 18% growth across all of them over the past decade.
Larger-scale employment sectors that experienced the most significant growth were construction (up 42%), health care and social assistance (38%), and retail (up 27%).
Employment in the manufacturing sector remained relatively stable overall.
There have been declines in some sectors, ranging from mining (falling 7%) to wholesale trade (down 20%).
Tate said the basis of competitive advantage for future Hunter growth included the existing pools of skilled labour, production and distribution infrastructure and services, and commercial knowledge and networks.
The Hunter holds an established competitive advantage in coal mining, which accounts for 79% of all mining-related activity in the region. More than 60% of coal mining employment in NSW is located in the Hunter, along with 41% of other mining support services employment.
The Hunter represents 8.5% of the state’s workforce, while accommodating 14.8% of the state’s defence employees, with nearly 13% of the state’s aircraft manufacture and repair employees based in the Hunter.
More than 10% of the Hunter’s workforce is employed in manufacturing, compared to 9.6% for NSW overall. Particular areas of advantage in manufacturing are ferrous and non-ferrous metals smelting, manufacturing and fabrication; machinery and equipment; electrical equipment; professional and scientific equipment; explosives and fertilisers; petroleum and coal products; railway rolling stock; ship and boat building and repair; and veterinary pharmaceuticals and medicinal products.
It is particularly strong in aluminium smelting – a third of Australia’s output comes from the region.
Agricultural production is relatively higher in the Hunter when compared with NSW as a whole.
The region has higher proportions of employees in electricity distribution, generation, supply and transmission employment sectors.
Nearly 13% of NSW employment in engineering design and consulting services is located in the region.
The region’s significance as an import and export centre and distribution hub is demonstrated by higher levels of employment in port and water transport terminal operations and rail freight transport (36.6% and 28.5% of state totals).
There are plans to develop a former BHP steelworks site into an industrial park, and rehabilitation of the site is nearly completed. Two proposals for its redevelopment are being considered with a decision expected in April next year.
Other projects include an aviation and defence-related employment zone based around Newcastle Airport and fisheries, employment and training initiatives.
The Lower Hunter Regional Strategy is a detailed development plan for five local government areas – Cessnock, Lake Macquarie, Maitland, Newcastle and Port Stephens. These are perceived as being critical to state and regional development, due to the population concentrations in these areas and the location of key strategic assets.
Key elements of the strategy are:
An additional 115,000 dwellings by 2031, to accommodate 160,000 people; and
66,000 new jobs.
A key challenge in regional planning was the closure of the BHP steelworks in 1999. A target of 5000 new jobs over two years was set to offset this and 5300 new jobs were generated by 2002.
The region’s population is expected to rise from 589,000 persons in 2006 to just under 709,000 by 2026. This represents an average annual growth rate of 0.93% over the two decades.
This rate is higher than the average of 0.8% per annum that prevailed over the decade between 1996 and 2006.
Tourism is a major part of the region’s economy. Last year 6.5 million people visited the Hunter, spending $1.23 billion.
Technological advances, such as ICT capacity, infrastructure and access improvements are also critical to the development of some industries.
The importance of the development of transport infrastructure is apparent in its identification as a key infrastructure challenge. Developments such as the F3 Freeway, Newcastle Airport and the Port of Newcastle are particularly important and will play a role in planning as far ahead as 20 years.
A major new gas pipeline will provide a stimulus to the region. The 820km Queensland Hunter Gas Pipeline will bring coal seam gas to the local market, especially for power generation, and also encourage the development of nearby coal seam gas reserves. Subject to regulatory approvals, work could begin next year and the first gas delivered two years later.
Hunter Valley wines are admired throughout the world and provide a particularly satisfying element of the region’s economy. The industry produces 24 million litres of wine annually valued at more than $200 million, of which more than a third is exported.
Expenditure on wages and capital investment totals $75 million, with more than 3000...click here to read on.
