Some up, some down

A RECENT survey has revealed that while some manufacturers in the south-east region had recovered from the GFC, others are still battling.
The survey, conducted by South East Melbourne Manufacturers Alliance (SEMMA) in January, found that while about two thirds of local manufacturers had seen revenues increase in 2010 compared to 2009, over a quarter experienced a revenue drop last year.
SEMMA executive officer Paul Dowling stressed that growth which is achieved at the expense of profitability cannot be sustained long term.
Mr Dowling said the survey, based on responses from 107 companies with revenues ranging from less than $1 million to large enterprises with revenues with more than $100 million, gave an important insight into the conditions being faced by the manufacturing sector.
“It’s of fundamental importance that politicians and policy makers grasp that there are positive economic signals for Australian manufacturing, but with the dollar still at historic high levels and local demand uncertain, especially following the devastating floods in Victoria and Queensland, many manufacturers are still doing it tough,” he said.
Mr Dowling said this also played out in terms of employment.
According to the survey, although 55 per cent of companies had increased headcount during the year, the remainder stayed put or shrank.
“There is still clear evidence of a two speed economy affecting local manufacturers,” he said.
“I have spoken to a range of SEMMA members in the last couple of weeks about how their businesses are tracking.
“I’ve heard everything from ‘we have no work’ to ‘our order books are completely full for the next few months’.”
He said many SEMMA members also pointed to the challenges they faced as a result of the high Australian dollar and its impact on exports.
SEMMA has provided the results of its findings to the Federal and State Governments.
Mr Dowling said as far as the outlook for 2011 was concerned, SEMMA members remained optimistic, with 77 per cent predicting sales this quarter will equal or exceed those achieved in the first quarter of 2010.
However, he said, a concerning 23 per cent still expect sales to fall this quarter, compared to a year ago.