Australian manufacturing has undergone significant transformation over the past few decades. It is a hub for research and development (R&D), capital investment and innovative businesses and products. It is Australia’s sixth largest industry, produces $137 billion of value-added output and employs 930,000 people. It generated 12.4% of Australia’s exports and 7.9% of capex investment in 2024, despite being only 5.1% of GDP.

This report on manufacturing explores the industry’s unique strengths and challenges with analysis of key performance factors such as economic and demand conditions, cost pressures, trade exposure, workforce needs and investment.

Key performance factors in 2024

• Recession conditions return
• Slowing economy bites
• Cost pressures mount
• Industry composition shifts
• Investment remains robust. 

Outlook themes for 2025

• Productivity blues
• Gas and the future
• Trade war looms
• Skills shortages remain
• R&D is key.