29 November 2006
'Melbourne's Second Speed Economy' co-authored by Drs Bob Birrell, Ernest Healy and T.Fred Smith from the Centre for Population and Urban Research at Monash University, warns that Melbourne is about to enter a period of economic slowdown, as has occurred in Sydney.
Since 1999 there has been a massive property boom in Melbourne, with related industries in the business services and construction sectors experiencing huge growth. However, analysis shows that the property boom is coming to an end.
The researchers have called on the new Bracks Government to alter its earlier economic strategy so that Melbourne is better prepared for the downturn.
"The Bracks Government's current strategy is set to fail," said co-author and Centre Director Dr. Birrell.
"The Government strategy has been to continue promoting population growth to maintain the property boom while creating a global centre of hi-tech innovation, to replace the job losses in the manufacturing sector.
"Melbourne (like Sydney) is likely to lose people to Western Australia and Queensland because of demand for workers stimulated by the resources boom. Also, while there are some hi-tech successes, the Government has failed to grasp that such innovation depends on the maintenance of a strong manufacturing base, which the report illustrates is in serious decline."
The report warns that having a Government strategy for economic renewal built on high-tech 'sunrise' industries is not sustainable.
Co-author Dr.T.Fred Smith said, "the State Government has invested heavily in scientific research infrastructure, including the $157 million Australian National Synchrotron and also in the Bio21 facility. While a welcome boost for pure research, these investments will not provide significant employment gains in the near future."
Dr Birrell continues, "We believe that the new Bracks' Government should focus its resources on helping local industries refine their existing products in a ferociously competitive global marketplace."
"The current mindset of the Victorian and Federal governments is to simply let manufacturing sink or swim. There is also a desperate need for more applied engineering training in a context where the Federal has failed to increase training since it came to office in 1996. All the firms consulted asserted that their current competitive advantage depends heavily on a supply of high quality engineering graduates. The Bracks government itself should make this investment."
For more information, a copy of the report or an interview with co-author Bob Birrell or his co-authors, please contact; Jocelyn Hunter in the media office on +61 3 9902 0256 or Bob Birrell directly on; +61 3 9905 2967 or +61 3 990 52965 (CPUR Office). | 
