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Productivity growth in the construction sector is expected to be quite
weak at 0.9 per cent per year, reflecting weak growth in profitability and
hence investment through the projection period. This gives the sector an
employment growth ranking for the forecast period of eighth, despite its
low output ranking.
Agriculture, forestry and fishing (ranked 17)
The low ranking of Agriculture, forestry and fishing is mainly a reflection
of the forecast of weak growth in exports (see Table C.2). Comparatively
slow growth in the sector’s domestic sales has also been forecast. Most of
these sales are to the slow growing areas of the food, beverages and
tobacco sector.
Within agriculture, the industries with the best growth prospects are milk
cattle (benefiting from good prospects for the exports of milk products)
and the other farming industries (which generally include export-oriented
activities such as wine-grape and sugar cane production). Forestry and
logging benefits from good prospects for exports.
Employment in the sector is expected to exhibit a small positive rate of
growth in the forecast period. The employment and output forecasts
imply labour productivity growth through the forecast period of
2.3 per cent.
Public administration and defence (ranked 18)
The forecast for output growth in the sector is 2.0 per cent per year,
slightly below that of public consumption (Table C.1). Within the sector,
it has been assumed that the trend over the last decade of lower spending
on defence will continue. 31 Output growth in public administration and
defence is measured by the ABS largely by labour inputs. Nevertheless,
ABS statistics for the sector imply productivity growth of about
0.8 per cent per year. It has been assumed that productivity growth will
continue at roughly this rate, giving employment growth for the sector at
the average annual rate of 0.8 per cent.
Wood and wood products (ranked 19)
The industries in this sector have diverse output growth rates in the
forecasts. Overall, the sector’s growth rate is expected to be 1.8 per cent
per year, considerably below that of GDP.
The slowest growing industry in the sector is forecast to be sawmill
products. About 20 per cent of this industry’s output is exported, but the
industry is expected to suffer from slow growth in its export sales. The
sector’s fastest growing industry is forecast to be veneers and wood
boards. This benefits in the forecast from a strong shift in consumer tastes
towards its product. The prospects of the other industries in this sector
reflect a mixture of increasing import pressure, offset by fairly good
export growth.
Employment in the sector is expected to grow at the average annual rate
of 1.4 per cent, with productivity growth of only 0.4 per cent per year.
31 Recent policy developments may alter this trend. Increases in defence spending would imply that the
modelled results understate the potential impact of greater use of e-commerce on this sector.
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