Labour crisis easing and ag to star as Aust 'outperforms' in tough year


Agriculture's chronic labour shortages are on a stabilising trend and could be well on the way resolved by the time the busy harvest season rolls around at the end of the year.

The national economy is also set to generally outperform other developed nations and avoid recession, according to leading Commonwealth Treasury economist, Sarah Hunter.

She said latest migration data showed a big uptick in arrivals with longer term visiting plans as students and workers returned to Australia following the pandemic lockdown years.

Although Australia's economic prospects faced undeniable challenges, and the next two years would be tough as inflation and interest rates bit households and businesses, Ms Hunter said the near term was far from all gloom and doom.

"Australia was an outperformer last year, with the economy actually expanding seven per cent over the COVID period from 2019 to 2022," she told the national agricultural Outlook 2023 in Canberra.

The strength of our exports, including a bullish performance by farm sector exporters, was expected to continue to remain solid, helped significantly by Australia's proximity to South East Asia - the world's fastest growing regional economy.

At the same time, long term visitor arrivals indicated a surge of extra skilled and unskilled labour becoming available to help keep our farm economy moving ahead.

The migration trend would also help the tourism and service industries weather global economic pressures.

"The data suggests some much better news for agricultural labour availability this year," she told the annual Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) event.

"The acute labour shortages that agriculture has been particularly exposed to should start to resolve themselves this year."

Commonwealth Treasury economist, Sarah Hunter.
Export driver

She said agriculture was already playing a vital part in the nation's improved export story, which was one of the trends expected to help the economy navigate a soft landing "on a narrow path" in 2023.

Farm sector exports were likely to continue performing well, particularly as rapidly rising demand for food in Asia would only intensify this decade.

"The fundamentals for agriculture are positive," Ms Hunter said.

"We're right next door to the world's fastest growing economic region.

"India's economic growth will increase by 6.5pc to 7pc every year until at least 2030; Indonesia will grow 6pc every year, other large economies in the region such as the Philippines and Vietnam have millions of consumers with rising incomes; China's economy is expected to stay on its present growth trend."

Written by Andrew Marshall and published 8 March 2023. Full article found on FarmOnline.

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