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Resources Industry Training Council (RITC)

Industry Workforce Development Plan

Downstream Process Manufacturing

Plan Details:

Plan Title: Resources Industry Training Council (RITC) Industry Workforce

Development Plan – Process Manufacturing

Issue Details: Issue 3, 2015

Approval Authority: Chamber of Minerals and Energy of Western Australia (Inc)/RITC

Industry Advisory Board

Submission Authority: Chamber of Minerals and Energy of Western Australia

(Inc)/Resources Industry Training Council

Approval: Ms Sanchia Tolomei (Chair, RITC Industry Advisory Board)

Approval Authority: Chair of Training Council Board of Management

Signature:

Date: 9 September 2015

Endorsement: Department of Training and Workforce Development

Signature:

Date: 9 September 2015

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FOREWORD

The Resources Industry Training Council (RITC) is a state government funded partnership

between the Chamber of Minerals and Energy of Western Australia Inc (CME) and the Australian

Petroleum Production and Exploration Association (APPEA). Members of these peak organisations

account for over 95 per cent of mineral and energy production in Western Australia and over 98

per cent of national oil and gas production.

The RITC is funded by the Department of Training and Workforce Development (DTWD) to provide

strategic information and advice on vocational education and training and workforce development

needs of industry in Western Australia. For its stakeholders, the RITC aims to create a forum

where industry leaders, skills development organisations, and other key interest groups and

interested enterprises can collaborate to address workforce development issues as they affect

industry in Western Australia.

Industry coverage of the RITC is diverse, comprising mining and mining exploration, oil and gas

exploration, extraction and production, and a group of industries that can best be described as

comprising process manufacturing. This last group is particularly varied in its composition and

includes industries from paint and cement manufacture, to rubber and plastics manufacture, to

metallic and non-metallic mineral production, to laboratory operations.

Over the last decade Western Australia has benefited from unprecedented growth in activity in the

resources sector, with mining being a major contributor to the Australian economy through export

earnings and capital investment. Recent years have seen a moderation of activity in the mining

industry as it continues to transition from construction to production. Faced with high operating

costs and significantly lower commodity prices the sector is now operating in a cost constrained

environment with producers focusing on organisational restructuring and downsizing operations,

managing costs, production efficiencies and production management to remain globally

competitive against increasing competition from overseas suppliers. This rationalization is seeing

major companies turning towards innovation, technological advancements, automation and data

analytics to address these issues across the value chain to maintain a competitive edge.

Similarly, in light of the recent halving of the price of oil, the oil and gas sector is faced with added

pressure to contain costs and boost productivity as construction winds down and the shift towards

production gathers pace. The oil and gas sector is not a large direct employer. According to a

recent report from Accenture1, the industry employed about 34,200 people nationally in 2014 and

this is expected to decline to around 30,500 by 2020. The industry, however, is known to have a

large employment multiplier. The US Bureau of Economic Analysis2 has estimated the oil and gas

extraction sector employment multiplier to be 6.9 – meaning for every job created in the oil and gas

extraction industry, a further 6.9 jobs are created in the wider economy.

Despite the current margin constrained environment, industry wide efficiency measures and

softening in employment conditions, the resources industry continues to be a major contributor to

growth in Western Australia with $179.3 billion resource projects under construction or committed

and a further $118.4 billion under consideration in the state.

1 Accenture, Ready or Not? Creating a world-leading oil and gas industry in Australia, May 2015

2 http://www.contentfirst.com/multiplier.shtml accessed 2 August 2015

http://www.contentfirst.com/multiplier.shtml

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Domestically, our manufacturing sector continues to experience a period of substantial transition

and change. Government policy has moved away from an industry protectionist stance to one

based on supporting manufacturing industries where Australia has a strong competitive advantage

such as advanced manufacturing. This direction, signaled in the Australian Government’s Industry

Innovation and Competitiveness Agenda, presents many challenges and opportunities to the

manufacturing sector and will require a concerted effort to ensure the manufacturing labour force

has the necessary skills based and innovative capability to grow and sustain its competitive

advantage.

The need to develop and maintain a productive workforce in the current climate emphasizes a

continued need to focus on workforce planning to ensure the future health and sustainability of the

RITC industries in Western Australia. In a new competitive world driven by innovation,

technological advancements, automation and digital information it is imperative we develop and

access high quality skills and capabilities to meet the demands of our changing industries. The

shift to operations will bring about sustainable jobs for highly skilled workers in the state,

particularly in professional and higher level VET based occupations and it is vital we better tailor

education and training to increase opportunities for a diversified participation of all in employment

and skills development, particularly in regional Western Australia and in turn remain internationally

competitive amidst a growing economy3. To retain its competitive advantage, workforce planning

must be a collaborated effort between education providers, industry and government with greater

alignment between the national scientific research agenda, specifically the development of

science, technology, engineering and mathematics (STEM) skills and areas of strength in the

Australian economy. Recent commonwealth and state reforms support these aims.

This workforce development plan aims to, in an accessible way, inform those interested in Western

Australia’s mining, oil and gas and process manufacturing industries of the current and projected

activity levels in those industries and highlight factors that will have an impact on workforce

development in future years.

Ms Sanchia Tolomei

Chair of the Resources Industry Training Council Industry Advisory Board

3 CEDA, Australia’s Future Workforce, June 2015

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Table of Contents

FOREWORD ............................................................................................................................... 2

OVERVIEW .................................................................................................................................... 6

Issuing Authority .......................................................................................................................... 6

Aim .............................................................................................................................................. 6

Objectives ................................................................................................................................... 6

SECTION 1 EXECUTIVE SUMMARY ............................................................................................. 7

1.1 Introduction ................................................................................................................... 7

1.2 Industry Sectors and Training Package Coverage ......................................................... 7

1.3 The Downstream Process Manufacturing and Laboratory Operations in 2014/15.......... 7

1.4 Workforce Development Drivers .................................................................................... 9

1.5 Fast Facts ................................................................................................................... 10

1.7 Summary of Issues Table ............................................................................................ 12

SECTION 2 METHODOLOGY ...................................................................................................... 14

SECTION 3 INDUSTRY PROFILE................................................................................................ 15

3.1 Overview of the Downstream Process Manufacturing Industry ................................... 15

3.1.1 Downstream Process Manufacturing Industry Analysis ........................................ 15

3.1.2 Industry Trends .................................................................................................... 16

3.1.2.1 Gold and Other Basic Non-Ferrous Metal Manufacturing .......................... 17

3.1.2.2 Alumina Production .................................................................................. 18

3.1.2.3 Industrial Gas Manufacturing .................................................................... 18

3.1.2.4 Petroleum Refining and Petroleum Fuel Manufacturing ............................ 18

3.1.2.5 Explosives Manufacturing ......................................................................... 19

3.1.2.6 Environmental Science Services .............................................................. 19

3.1.2.7 Pesticide Manufacturing ........................................................................... 20

3.1.2.8 Basic Inorganic Chemical Manufacturing .................................................. 20

3.1.2.9 Clay Brick Manufacturing ......................................................................... 20

3.1.2.10 Lubricants and Other Petroleum Product Manufacturing ........................... 21

3.1.2.11 Commodity Price Volatility ........................................................................ 21

3.1.2.12 Residential Construction Activity ............................................................... 21

3.1.2.13 Import Penetration from Asia .................................................................... 22

3.1.3 Labour and Skill Demand ....................................................................................... 22

3.1.3.1 Identify the Workforce ............................................................................... 23

3.1.3.2 Sourcing the Workforce ............................................................................ 25

3.1.3.3 457 Visas.................................................................................................. 26

3.2 Regional Impact ............................................................................................................... 26

3.2.1 Regulatory Requirements ....................................................................................... 27

3.2.1.1 COAG Reform Agenda: Plastics and Chemicals ........................................... 27

3.2.1.2 National Association of Testing Authorities (NATA) – Changes to Construction

Materials Testing (CMT) Accreditation ...................................................................... 27

3.2.1.3 Impact of OSH Harmonisation ...................................................................... 28

3.3 Gender/Age Participation ................................................................................................. 28

3.3.1 Gender Diversity ..................................................................................................... 28

3.3.2 Workforce Age Profile ............................................................................................. 29

3.3.3 Under-represented Groups Participation ................................................................ 31

3.4 Major Challenges and Barriers ......................................................................................... 31

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3.4.1 Quality Flexible Training Options and Delivery ....................................................... 31

3.4.2 Relevance of Qualifications and Funding ................................................................ 32

3.4.3 Industry Cost Competitiveness ............................................................................... 32

3.4.4 Accessing a Skilled Workforce ............................................................................... 32

3.4.5 Science, Technology, Engineering and Mathematics (STEM) Skills ....................... 33

3.4.6 Innovation, Research and Development ................................................................. 33

3.4.7 Language, Literacy and Numeracy Skills ................................................................ 34

3.5 New and Emerging Skills ................................................................................................. 34

3.6 Occupations in Demand (ANZSCO Code) ....................................................................... 36

3.7 Workforce Development Opportunities ............................................................................. 41

3.7.1 VET Training Data by Qualification ......................................................................... 42

3.7.2 Pre-Employment ..................................................................................................... 43

3.7.3 Apprenticeships and Traineeships .......................................................................... 46

3.7.4 VETiS ..................................................................................................................... 49

3.7.5 Higher Education Pathways .................................................................................... 51

3.8 Downstream Process Manufacturing Industry Issues ....................................................... 51

3.8.1 Technology and Advanced Manufacturing .............................................................. 51

3.8.2 Skill Development ................................................................................................... 51

3.8.3 Training .................................................................................................................. 51

3.8.4 Government Policy and Research and Development Outcomes............................. 52

3.8.5 Ageing Workforce ................................................................................................... 52

3.8.6 Youth ...................................................................................................................... 52

3.8.7 Gender Diversity ..................................................................................................... 52

3.8.8 Indigenous Australians ........................................................................................... 52

3.8.9 Relevance of ANZSCO for Skilled Occupation Lists ............................................... 53

3.8.10 VET in Schools ..................................................................................................... 53

3.8.11 Language, Literacy and Numeracy Skills .............................................................. 53

SECTION 4 INDUSTRY ISSUES AND STRATEGIES .................................................................. 54

SECTION 5 RECOMMENDED PRIORITY ACTION PLAN ........................................................... 58

SECTION 6 PLAN ADMINISTRATION ......................................................................................... 60

Plan Contact .............................................................................................................................. 60

Review Requirements and Issue History ................................................................................... 60

Distribution List .......................................................................................................................... 60

Consultation for this Issue ......................................................................................................... 60

Communications Plan Summary ............................................................................................... 60

Validation of this Plan ................................................................................................................ 61

SECTION 7 LIST OF TABLES ..................................................................................................... 62

SECTION 8 GLOSSARY .............................................................................................................. 63

Acronyms .................................................................................................................................. 63

SECTION 9 APPENDIX 66

Appendix 1: Key RITC Industry Areas – Projected Economic and Activity Conditions (Australia)66

Appendix 2: Downstream Process Manufacturing in Western Australia ..................................... 69

Appendix 3: Western Australian Downstream Process Manufacturing by Industry Area ............ 70

Appendix 4: Total Downstream Process Manufacturing by Gender ........................................... 73

Appendix 5: Comparison of Downstream Process Manufacturing Workforce with Indigenous

Participation Rates .................................................................................................................... 77

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OVERVIEW

Issuing Authority

This plan is issued under contract between the Department of Training and Workforce

Development and the Training Council in accordance with the requirements of Schedule 2 of the

Service Agreement and is maintained by the Training Council.

Aim

The aim of the plan is to outline industry workforce development trends, strategies and actions that

provide high-level advice to the Department to inform future strategic directions and Skilling WA –

A Workforce Development Plan for Western Australia.

Objectives

The objectives of this plan are to provide the Department with:

a A profile for the downstream process manufacturing industry in Western Australia;

b High-level state and national industry data and forward projections in regards to:

I. Economic trends and impacts on workforce planning;

II. Current and future labour market modeling consistent with information provided

for the development of the State Priority Occupation List (SPOL);

III. Regional variations that may affect workforce planning;

IV. Training and education including vocational education and training delivered to

school students (formerly VETiS); and

V. Industry critical aspects that may impact on future planning.

c Identification of issues that impact on state workforce planning and that inform and are

linked to Skilling WA strategies.

These objectives are established so that effective development of workforce planning in regions

and at state level can occur.

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SECTION 1 EXECUTIVE SUMMARY

1.1 Introduction

The Resources Industry Training Council (RITC) covers a diverse range of industries ranging from

mining and oil and gas production through to plastics and rubber manufacturing and laboratory

operations. While these industries are experiencing different economic fortunes, they all share

similar issues in terms of ensuring access to a suitably skilled workforce which is necessary for

their continued sustainability.

The manufacturing industry is becoming more sophisticated and advanced in its pursuit of problem

solving innovations and high quality, niche products and services in supply chains to remain

globally competitive and sustainable, particularly in fields such as mining equipment, chemical

products and biotechnology. Although areas of manufacturing are well positioned to improve their

market position amongst high growth and emerging economies, parts of the RITC industry

coverage from the more mature basic chemical and chemical product manufacturing sectors,

polymer product and rubber manufacturing sector and non-metallic mineral product manufacturing

sectors are bearing the effects of more normalised economic conditions, highlighting the close link

between the downstream process manufacturing industries, the transitioning resources sector and

bulk commodities.

1.2 Industry Sectors and Training Package Coverage

Resources Industry Training Council (RITC)

Industry Sectors

(a) Mining

(b) Oil and Gas

(c) Downstream Process Manufacturing

Training Packages

(a) MSA07 - Manufacturing

(b) MSL09 - Laboratory Operations

(c) PMA08 - Chemical, Hydrocarbons and Refining

(d) PMB07 - Plastics, Rubber and Cablemaking

(e) PMC10 - Manufactured Mineral Products

(f) RII - Resources and Infrastructure

To contextualize the RITC industry and training package coverage in Western Australia, Appendix

1 provides an overview of the projected economic and activity conditions for key areas of the RITC

industry coverage and outlines the stark contrast between different industry sectors that was

indicated above.

1.3 The Downstream Process Manufacturing Sector and Laboratory Operations in

2014/15

Manufacturing has a significant footprint in the Australian economy. According to the

Manufacturing Skills Australia Environmental Scan 2015, it produces around $100 billion of output

every year and provided over $101 million in industry value add (IVA) in 2013-14. It is one of

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Australia' key industry areas, employing 6 per cent of Western Australia’s workforce4 with almost

83 per cent of jobs nationally being full time5.

Over the past 10 years, employment in Western Australia’s manufacturing sector has experienced

an overall decline of 7 per cent, dropping from 94,800 employees in May 2005 (constituting 9 per

cent of employment) to 87,900 employees in May 2015, reflecting the relatively fragile state of

manufacturing in Western Australia. Along the way, employment peaked in February 2009

(103,300) and 2012 (101,700) but continued its fluctuating downward trend thought to reflect the

sector’s exposure to Western Australia’s resources development sector6.

In contrast, in the last decade, the professional, scientific and testing services that includes

scientific research and scientific testing and analysis services has increased by 63 per cent from

68,400 workers to 111,500 workers which now constitutes 8 per cent of the Western Australian

workforce7. This sector has benefitted from growth in the resources sector and also the health

sector.

The drop in the manufacturing workforce is symptomatic of the issues that have been experienced

by many sectors of Australia’s manufacturing industry in recent times and the transition period

through which that industry is travelling. The CSIRO notes8, while the global chemicals and plastics

industry is growing rapidly, the domestic industry is lagging behind. Since 2007, industry value

added has been stagnant, the number of businesses operating domestically has decreased and

employment in the industry has declined.

Many manufacturing subdivisions in Western Australia continue to suffer from high import

penetration from neighbouring Asian countries, where companies are able to gain a competitive

advantage through lower cost structures. These sub-divisions are usually labour-intensive

operations where specialist skills are not fundamental to the production process and where

finished product transportation does not pose any significant barrier.

The construction markets of China and other Asian countries have been driving the export market,

not only for the raw materials, but also in the demand for value-added processed products and

products in demand for mining services. Although the Chinese property market has cooled, new

construction continues.

Until recently, the rapidly increasing prices for commodities on the international stage have had a

profound impact on the local manufacturing market, especially for small and medium enterprises

(SMEs), which constitute the majority of the manufacturing enterprises in Western Australia9. The

rising price of petroleum and raw materials such as those used in non-metallic mineral product

manufacturing and metal product manufacturing have had a negative impact, forcing smaller

enterprises to absorb increased costs due to limited external demand and competition from

imports. The last 12 months have seen an easing in these cost pressures due to the sharply falling

commodity prices.

Similarly, although the labour market for critical occupational groups in the resources sector has

softened, particularly in the second half of 2014-15, thus lessening the skill shortage impost

experienced during the boom across the RITC industry coverage, a continued focus on workforce

4 ABS, Detailed Labour Force Quarterly, May 2015

5 Manufacturing Skills Australia Environmental Scan 2015



8 CSIRO/PACIA, Strategic Directions – Towards sustained growth of the Australian chemicals and plastics industry, May

2013. 9 Manufacturing Skills Australia, ABS Small Business Count Data 2010

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planning is needed to ensure a sustainable downstream process manufacturing industry in

Western Australia. The manufacturing industry is transitioning into niche, specialized high quality

and globally attractive goods and services.10 While some of the workforce development

implications arising from this transition are yet to be fully comprehended, manufacturing workers of

tomorrow will need to have high levels of science, technology, engineering and mathematics

(STEM) skills, flexibility, resilience and innovation to meet employer and market requirements. As

industry implements new advanced technologies, automation and computer based applications it

will rely more heavily on changing worker skills and capabilities to remain internationally

competitive.

Our changing workforce and skill needs reflect a changing industry and in order for both to evolve it

is vital we have an education and training system capable of developing a flexible and highly

skilled workforce and increasing employment and skills development opportunities for diversified

participation. Enterprises participating in the latest e-scan identified workforce training and

development as the top priority for lifting outcomes, followed by improved leadership and

management, technology and processes11.

1.4 Workforce Development Drivers

Workforce development drivers across the downstream process manufacturing industry and the

professional, scientific and testing services in Western Australia have diverged in recent times.

The core downstream process manufacturing sector has been impacted by economic turbulence

caused by domestic conditions and the increasing dominance of Asian based low-cost producers.

This turbulence is promoting a restructuring of Australia’s manufacturing industry to those areas

where a competitive advantage exists, including highly specialised, low-production run advanced

manufacturing products. In a 2014 study of five industry groups by the Office of the Chief

Economist, 19,000 firms were found to be operating in advanced manufacturing. The bulk of these

were small employing firms with a combined total estimate of 250,000 employees, generating in

excess of $30 billion in output in 2013-14 and export revenue of around $11.2 billion in 2012-1312.

This shift towards areas where a competitive advantage exists across global supply chains relies

heavily on technologically driven inventions and innovations which increasingly rely on a need for

higher skilled and more flexible and innovative workers.

Parts of the professional, scientific and testing services sector, with a resources sector related

exposure, have been expanding substantially in line with increased resources sector activity.

According to IBISWorld13, mining accounted for 37.5 per cent of revenues for the environmental

science services sector in 2014/15. This has driven demand for laboratory services technicians

and occupations related to mineral sample collection. As detailed in the recent e-Scan, a modern

manufacturing industry needs to build its workforce by addressing the following:

Public industry perception to attract new workers

Flexible and highly skilled workforce

Leadership and management capability

Technology and innovation

Productivity, collaboration and research and development outcomes

Business composition

10

Manufacturing Skills Australia, 2014 Environmental Scan Summary, 2014 11

Manufacturing Skills Australia, Environmental Scan 2015 12

Office of the Chief Economist, Australian Industry Report, 2014 13

IBISWorld, Industry Report M6925 – Environmental Science Services in Australia, March 2014

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Import competition

Government policy and agenda

Education and training

1.5 Fast Facts

According to the 2011 Census of Population and Housing approximately 27,000 people

were employed in downstream process manufacturing in Western Australia representing

2.5 per cent of total employment. By comparison, the manufacturing sector employed

87,900 workers according to the May 2015 ABS labour force survey.

Employees in downstream process manufacturing are concentrated across the following

industry sub-groups:

o Petroleum and Coal Product Manufacturing

o Basic Chemical and Chemical Product Manufacturing

o Polymer Product and Rubber Product Manufacturing

o Non-Metallic Mineral Product Manufacturing

50% of employees in downstream process manufacturing are employed in:

o Alumina Production

o Scientific Testing and Analysis Services

o Scientific Research Services

o Other Basic Non-Ferrous Metal Manufacturing

o Basic Inorganic Chemical Manufacturing14

Today, manufacturing is Australia’s sixth-largest employer, employing 916,800 workers, or

8 per cent of total employment15. It employs many more indirectly, through outsourcing

related services such as engineering, design, systems integration and marketing. The

industry accounts for 6.6 per cent of Australia’s gross domestic product, 33.5 per cent of

merchandise exports and just under 25 per cent of business expenditure on research and

development16.

Manufacturing produces around $100 billion of output every year, provided $101,586 million

in industry value add (IVA) in 2013-201417.

Across the manufacturing sector, 32 per cent of the workforce is classified as technicians

and tradespersons, 11 per cent as machinery operators and drivers, 8 per cent as

professionals and 13 per cent as managers. This reflects the scientific analysis and testing

emphasis in Western Australia which is driven by the resources and health sectors.

Across the downstream process manufacturing sector, 27.7 per cent of the workforce is

classified as technicians and tradespersons, 13.5 per cent as machinery operators and

14

ABS, 2011 Census 15

ABS Labour Force, May 2015 16

Australian Workforce and Productivity Agency, Manufacturing Workforce Study, October 2013. 17

Manufacturing Skills Australia, 2015 Environmental Scan

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drivers, 9.5 per cent as professionals and 14.9 per cent as managers. This reflects the

scientific analysis and testing emphasis in Western Australia which is driven by the

resources and health sectors.

Female workforce participation in these industries is varied, with the average female

workforce participation sitting at 31 per cent.

Industry groups under this broad category typically refine or process raw materials or

feedstocks from the upstream resources sector either into intermediate products for further

processing, or finished products that are sold domestically or exported.

The professional, scientific and testing services sector has a strong exposure to the

resources sector. Western Australia accounts for just over 21 per cent of the national

environmental science services sector and 10 per cent of the national scientific research

services sector according to IBISWorld.

Across this diverse group of industries, key factors affecting manufacturing include:

resources industry activity, volatility in commodity prices, decline in domestic construction

activity, global competition particularly from emerging economies and the Australian dollar.

Australian manufacturing has been in transition for many decades in response to a range of

domestic and global forces. Some of the drivers of change include labour productivity

growth associated with increased mechanisation and use of technology in production; tariff

cuts, which exposed the sector to greater international competition; and changing

consumer preferences towards services. More recently, the weaker Australian dollar and

lower commodity prices have eased some of the cost burden, however not enough to

lessen the pressure on industry from slow productivity growth across the economy, intense

global competition and a focus on sustainable production.

Globalisation and the internationalisation of technology and labour markets have seen

many manufacturing tasks outsourced from industrialised countries to lower cost

economies, especially those in Asia. Many of these emerging economies are gaining

market share not only in traditional manufacturing but increasingly in high-technology

sectors.

The process manufacturing industries in Western Australia have an ageing workforce which

highlights the importance of retaining a more mature workforce and also attracting a

younger workforce.

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1.6 Summary of Issues Table

Issue Recommended Priority Action(s) Skilling WA

Strategy

Lead

Agency

Due Date:

Industry has no

confidence in the training

system can produce

consistent outcomes.

Undertake a verification of competence project which will explore

development of an industry guideline for the verification of

competence applicable to the oil and gas and chemical industries.

Explore potential for standardisation of induction requirements for

contractors working on onshore oil and gas and chemical industries

as a means of reducing costs and improving outcomes.

Strategy 3

3.1.1

RITC June 2016

Process Manufacturing

industry access to skilled

workers

Identification of the workforce challenges faced by the state’s

process manufacturing sector and strategies to ensure access a

skilled workforce in the context of national industry policy.

Pilot an approach to address identified in a discreet area where

there is a concentration of process manufacturing industries (eg

Canning Vale/Welshpool).

Approach will involve a determination of workforce skills demand

and supply issues in the pilot area with a view to developing

strategies for implementation.

Strategy 3

3.1.1

RITC 2015/16

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Process manufacturing

industries generally have

an older age profile in

their workforce making

them susceptible to a loss

of skills and knowledge

when this component of

the workforce leaves.

Explore options for greater engagement with VET in schools (VETiS)

by the process manufacturing sector as a mechanism for addressing

future workforce skills requirements.

Review VETiS register following VETiS analysis to ensure there is

no impediment to delivery to school students.

Work with providers in the identified region(s) to encourage delivery

options are available for those industries/enterprises wanting to

engage with schools and school students through VETiS programs.

RITC to work with MSA to ensure VETiS pathways are apparent in

the training package development and review process for the

relevant process manufacturing training packages.

Jan-June

2016

Mid 2016

July-Dec

2016

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SECTION 2 METHODOLOGY

The Resources Industry Training Council subscribes to an evidenced based planning approach

and uses robust and verifiable primary and secondary data sources in developing the industry

workforce development plan.

Primary Data Sources

RITC social media

The RITC uses this mechanism to provide information and assistance to industry and training

providers operating in the mining, oil and gas and downstream process manufacturing industries in

Western Australia.

These social media channels include:

o Twitter: https://twitter.com/RITCWA

o Facebook: https://www.facebook.com/RITCWA

o Blog: http://ritcwa.blogspot.com.au/

o LinkedIn company page and group

Industry network meetings.

The RITC collaborates with relevant Industry Skills Councils around various events, seminars and

consultations in Western Australia.

Individual enterprise consultations

Independent validations as needed

RITC-commissioned research projects, available via our website: www.ritcwa.com.au

Third-party industry and economic research reports.

Secondary Data Sources

Australian Bureau of Statistics (ABS)

Bureau of Resources and Energy Economics (BREE) – now Department of Industry

National Centre for Vocational Education and Research (NCVER)

CME Diversity Survey 2013

IBISWorld Market Research

Range of industry report.

https://twitter.com/RITCWA

https://www.facebook.com/RITCWA

http://ritcwa.blogspot.com.au/

http://www.linkedin.com/company/2489911?trk=vsrp_companies_res_name&trkInfo=VSRPsearchId%3A1686078081366687935703%2CVSRPtargetId%3A2489911%2CVSRPcmpt%3Aprimary

http://www.linkedin.com/groups?gid=4812390&trk=hb_side_g

http://www.ritcwa.com.au/

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SECTION 3 INDUSTRY PROFILE

3.1 Overview of the Downstream Process Manufacturing Industry

3.1.1 Downstream Process Manufacturing Industry Analysis

Despite declines in manufacturing’s contribution to national employment and output, the industry

continues to play a vital part in Australia’s economy, directly employing 8 per cent of Australia’s

total employment, accounting for 6.6 per cent of the nation’s GDP18 and a third of merchandise

exports, with almost a quarter of business expenditure allocated to research and development.

Global and domestic forces continue to challenge the industry as traditional manufacturing and

high technology sectors are outsourced to lower cost economies.

International competition has driven the industry to explore competitive strengths and question its

current business models and practices. The future of the industry depends on its ability to produce,

innovate and manage productively19. With recent manufacturing closures and an industry in a state

of flux, strong growth has been emerging in niche, high skilled manufacturing such as professional

and scientific equipment and specialised precision engineering technologies and automation

related manufacturing.

The table in Appendix 2 compares statistical information on a broad range of downstream process

manufacturing industries covered by the RITC. According to this information, in 2014-15 the 10 key

industry subdivisions anticipated collective revenue of $61.7 billion and include:

Gold and Other Basic Non-Ferrous Metal Manufacturing

Alumina Production

Industrial Gas Manufacturing

Petroleum Refining and Petroleum Fuel Manufacturing

Explosive Manufacturing

Environmental Science Services

Pesticide Manufacturing

Basic Inorganic Chemical Manufacturing

Clay Brick Manufacturing

Lubricants and Other Petroleum Product Manufacturing

Less than a third of all industry areas represented in the table have experienced positive growth

nationally in the five years to 2014-15 with explosive manufacturing and basic organic chemical

manufacturing experiencing greatest increases of 10.2 per cent and 6.7 per cent respectively. Over

the same period, eight of the top dozen areas representing greatest activity in Western Australia

shouldered negative growth, most noticeably copper, silver, lead and zinc smelting and refining

(10%), petroleum refining and petroleum fuel manufacturing (8.3%) and basic inorganic chemical

manufacturing (4.8%). Other most affected industry groupings with a lesser level of activity in the

state also include soap and cleaning compound manufacturing (10%), other ceramic product

manufacturing (7%), plastic foam product manufacturing (6.1%), aluminium smelting (5.4%), and

plastic bag and film manufacturing (5%).

Compared to last year, the overall composition of the state’s top 10 industry groups has changed

marginally. However, it is the total revenue across those industries which accounts for an annual

revenue loss of $25.6 billion from $87.3 billion in 2013-14, largely attributed to the transitioning

resources industry from construction to operation and the volatility in commodity prices.

18

Australian Workforce and Productivity Agency, Manufacturing Workforce Study, October 2013. 19

Australian Workforce and Productivity Agency, Manufacturing Workforce Study, April 2014

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However, greatest activity does not necessarily correspond with revenue as seen with research

focused, specialised areas such as pharmaceutical product manufacturing and scientific research

services which only represent 6.5 per cent and 10.2 per cent of WA activity with a revenue of 9.2

billion and 4.5 billion respectively for 2014-15. Similarly aluminium smelting and ready-mixed

concrete represents 3.7 per cent and 9.2 per cent of WA activity with revenue of $5.8 billion and

$5.9 billion.

Growth in construction is reflected in the revenue generated by smaller manufacturing industries

with smaller representation in WA like clay brick manufacturing (9th), concrete product

manufacturing (13th), plaster product manufacturing (22nd), paint and coatings (24th), cement and

lime (25th) and ready mix concrete manufacturing (26th), totalling $16.5 billion, of which 56 per cent

is attributed to ready-mixed concrete.20

3.1.2 Industry Trends

For the downstream process manufacturing industries, the growth in mining (including oil and gas)

and exploration had opened up considerable business opportunities in the region. These benefits

can be summarised as suppliers or customers of the sector, with some industry areas such as the

scientific testing and analysis sector providing high level technical mineral assay services to the

resources sector.

Although these industry sub-divisions appear quite diverse, there are several significant issues that

are common. These include:

Reduced mining and exploration activity as the sector moves from construction to

operations;

Volatile commodity prices and energy costs, including petroleum;

Global industrialisation and economic growth;

Productivity through technological advancements and a shift to automation;

Growth in domestic construction activity;

Growing environmental concerns; and

Government initiatives.

From an overarching industry perspective, the process manufacturing industry makes a substantial

contribution to the national economy and society as shown in the below graphic taken from the

Plastics and Chemicals Industry Association’s (PACIA) strategic roadmap document.

20

IBISWorld, Manufacturing Industry Reports, June 2015

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Figure 1: Australia’s Plastics and Chemicals Industry

Source: PACIA, Adding Value – The critical, enabling role of the chemicals and plastics industry for Australia’s future,

July 2014

3.1.2.1 Gold and Other Basic Non-Ferrous Metal Manufacturing

Production of nickel and other basic non-ferrous metal manufacturing (such as gold and silica) hold

a 61.3 per cent Western Australian market share output. A great bulk of output is being exported

either in the form of gold bullion, refined nickel and semi-refined nickel matte. These industry areas

are highly susceptible to the volatility in commodity prices.

For gold and nickel the last 5 years has been characterized by fluctuations in industry revenue,

reflecting dramatic shifts in US dollar prices and Australian dollar volatility, increased exports of a

wide range of metals and a decline in domestic manufacturing levels. The industry is currently

going through a renaissance period in Western Australia with activity levels relatively high and

buoyed by global economic volatility and a relatively low Australian dollar.

The main use for nickel is in the manufacture of stainless steel and accounts for about 65 per cent

of nickel consumption worldwide. Export markets are projected to account for more than 80 per

cent of industry revenue in 2014-15, with only a small number of countries making up the main

export markets. Domestic manufacturers and other local markets make up the balance. Industry

revenue is forecast to grow by an annualised 0.9 per cent through 2019-20 to $21.2 billion.

The main product processed by the industry is refined gold. Refined gold volumes are expected to

total 318 tonnes in 2014-15, down from 356 tonnes in 2009-10 due to lower mining volumes and

some pricing declines.

Overall exports accommodate a small number of countries with all but one seeing levels of decline

since 2009-10. In 2014-15, Chinese gold export markets are expected to account for 39.5 per cent

of industry revenue, up from 2.6 per cent in 2009-10, driven by their manufacturing industries,

investment and government holdings.

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Gold imports, including scrap gold, are also high as these are refined or reprocessed and often re-

exported. Domestic gold market is estimated to account for 8.5 per cent of industry revenue in

2014-15, up from 6.9 per cent in 2009-10. Growth has been boosted by demand for jewellery

manufacturing and the manufacturing of electronic and electrical goods, as well as gold holdings

for companies, governments and households.

3.1.2.2 Alumina Production

Western Australia produces almost 43 per cent of alumina nationally with Australia being a key

global alumina producer, accounting for about 20 per cent of total world production each year.

Alumina is produced and either used domestically or exported overseas, to be smelted into

aluminium. The Asian Export Markets was our largest export market segment in 2014-15

accounting for 32.2 per cent of industry revenue, followed closely by the Middle East at 30.2 per

cent.

Total exports, amounting to an expected 17.2 million tonnes in 2014-15, should generate $6.6

billion revenue for the year, with the local market for alumina estimated at 1.3 billion, a total

increase of 11.7 per cent. As with nickel, alumina experiences volatility in price tracked against the

Australian dollar, export volumes and manufacturing levels. It is anticipated that despite price

volatility, production gains may see a growth of 0.2 percent through to 2019/20.

3.1.2.3 Industrial Gas Manufacturing

Approximately 30 per cent of industrial gas manufacturing is hosted in Western Australia with the

industry producing organic, inorganic, speciality, medical and refrigerant gases.

The development of new products and technologies, growing environmental concerns and the

diverse range of applications for industrial gases have influenced industry performance over the

five years through 2014-15.

Industry revenue can be captured by three key market segments for 2014-15: mining, minerals and

metal product manufacturing (60%), healthcare (25.5%) and specialised users such as

laboratories, research establishments and various electronics and semiconductor industries

(14.5%). Growth rates have slowed over the past five years with the industry estimated to grow

through 2014-15 to $4 billion impacted by a drop in mining investment.

Volatile energy costs have placed downward pressure on industry profitability, reflecting the

industry's high dependence on fossil fuels for production. In the next five years, industry revenue is

forecast to grow at an annualised 2.2 per cent, bringing revenue up to $4.5 billion due to recent

capacity expansions and the move into a phase of production.

In addition, the ongoing development of new technologies will drive new applications for industrial

gases, as will environmental concerns.

Demand for industrial gases is expected to fluctuate through to 2019-20, aligned with Australia's

resource and manufacturing sectors. It is anticipated that the metal, oil and chemical industries will

increase demand on industrial gases, driven by calls for cleaner burning fuels and the

hydrodesulfurisation of petroleum products.

3.1.2.4 Petroleum Refining and Petroleum Fuel Manufacturing

Petroleum refining is literally the refining of crude oil products to create a saleable commodity,

normally petroleum (42.7%) and diesel (36.2%), which represent a total of 78.9 per cent the refined

products produced nationally. 89.7 per cent of the products are destined for domestic use by

petroleum wholesalers and retailers, with only 10.3 per cent exported to overseas markets.

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In Western Australia the manufacturing of petroleum products accounts for 25.6 per cent of

national activity, produced by the state’s only refinery, BP Kwinana refinery, largest in Australia.

The refinery has been upgraded in recent years to produce low-benzene petrol and ultra-low

sulphur fuel, enhancing refinery optimization and reliability, and investment into cleaner fuel

production.

Revenue is expected to decline by 8.3 per cent over the 5 years through 2014-15 as the industry

competes with imported refined fuel products and sophisticated refineries in Asia-Pacific, coupled

with reduced output and mine closures, the volatility of world oil price and exchange rate

movements. In the 2014-15 year alone, industry revenue is expected to fall by 43.4% to $15.0

billion, following dramatic falls in the oil price. Further declines are expected in the years through to

2019-20 to $12.3 billion at an annual rate of 3.8 per cent.

3.1.2.5 Explosives Manufacturing

Explosive manufacturing companies across Australia have reaped the benefits of an active local

resources environment and are closely linked to bulk commodities like coal, iron ore, gold and

copper. Increased construction activity, expansions in mining industries, complex geological

conditions for greater accuracy, efficiency and mine lifespan and strong ammonium nitrate prices

drove record growth over the past 10 years to 2012-13.

The difficulties in transporting these hazardous materials often prohibit manufacturing overseas

and ensure a preference for local facilities and suppliers. Nationally, 39 per cent of industry activity

is directly related to metals mining. However, although industry revenue reached $3.6 billion in

2014-15 compared with $2.3 billion five years earlier, falling commodity prices and a subdued

demand from mining operators focusing on containing costs have slowed industry revenue,

estimated to fall by 2.1 per cent in 2015-16.

3.1.2.6 Environmental Science Services

For this industry sub-group at the national level, 37.5 per cent of revenue is derived from mining

technical services, with meteorological services (10%) and materials testing (7.5%) accounting for

a significant share of industry activity. The steady growth in environmental science services has

been predominantly driven by the boom in the energy and mineral resource markets, with a strong

focus on geotechnical modeling and metallurgical laboratory analysis of ore samples.

Demand for water supply, sewerage and drainage services has aided the growth further, as has

the shift towards greater outsourcing of testing and services. Over the past five years, revenue

rose by an annualised 2.0 per cent to reach $4.9 billion in 2014-15.

Trends in mining exploration expenditure influence demand for geological and geophysical

consulting services. In general, an increase in mining exploration boosts demand for industry

services, leading to revenue growth. Yet, although Western Australia has experienced a fall in

mineral exploration over the last few years, the resource sector’s drive for productivity and output

has continued a strong demand for continued advances in technology and hence associated

testing services.

Similarly, demand for scientific research services are influenced by levels of manufacturing activity,

the need for material and product testing and pollution monitoring. Although recent slowing in the

manufacturing industry has hampered activity, the industry has benefited from continued advances

in technology, which have prompted improvements in testing methods, the communication of

testing results and an expansion in the range of testing services available. According to IBISWorld,

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revenue growth is projected to stem partly from greater demand from scientific research services

forecast to rise by 1.3 per cent to reach $4.9 billion in 2014-15.

Growth is expected to reach $5.6 billion in 2019-20 predominantly due to increased demand for a

range of scientific research services including biotechnology and agriculture, a tightening of

pollution control regulations and demand for continued advances in technology. The importance of

scientific research to preserve the sustainability of the Western Australian resources sector is

further supported through recently announced government initiatives.

3.1.2.7 Pesticide Manufacturing

Although pesticide manufacturing in Western Australia represents 19.7 per cent of the nation’s

industry activity, it has experienced a downward trend over the past few years with a forecast worth

of $1 billion in 2014-15.

Some key factors influencing the industry are demands from weather dependent agriculture which

accounts for 75 per cent of pesticide consumption, regulatory framework governing the pesticide

value chain and the resulting costs associated with industry’s changing product portfolio and lower

prices for patent-expired products driven by the growth in generic products.

Industry revenue is forecast to reach $1.1 billion by 2019-20, propped up by the export market

which is expected to contribute 12.3 per cent of industry earnings in 2014-15 and has trended

upwards over the past five years as a percentage of revenue. A drive for a stronger industry will

need alternative pesticides including bio-pesticides and new pest control products developed with

new technology platforms.

3.1.2.8 Basic Inorganic Chemical Manufacturing

This industry is a vital part of the nation's overall chemical sector, providing important intermediate

chemical products used as basic chemicals in various industrial processes and manufactured

products. It makes up 18.5 per cent of activity in Western Australia with revenue affected by mining

and manufacturing levels of activity and international trade due to its market composition: mining

and metal processing industries (30.7%), manufacturing sector (20.5%) and international markets

(48.8%).

The industry is forecast to generate revenue of $2.5 billion in 2014-15 and to grow at an

annualised 1.1% over the next five years as the industry indirectly benefits from continued demand

growth from the mining division, anticipating a revenue total of $2.6 billion in 2019-20.

Revenue may be boosted by increased output from new plants that have recently commenced

production. Higher costs due to feedstock volatility and stricter environmental regulations may

hinder industry prospects in the short to medium term. In 2019-20, industry revenue is forecast to

total $2.6 billion boosted by increased production from new ammonia, sodium cyanide and chlor-

alkali plants.

3.1.2.9 Clay Brick Manufacturing

New residential building construction comprises 70 per cent of annual sales in clay bricks and

pavers produced by the industry. Western Australia comprises 17.7 per cent of clay brick

manufacturing. Trends towards double storey houses and multi-unit apartments place the industry

under pressure from substitute products such as fiber cement and polyurethane cladding. A

projected revenue total of $830 in 2014-15 reflects a 3.8 per cent increase due to a growth in new

housing construction. Anticipated growth in housing and commercial building should increase clay

brick production by an annualised 0.9 per cent with revenue reaching $866 million by 2019-20.

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The need to find lower cost housing options to make home ownership more affordable is driving

the exploration of alternative construction materials.

3.1.2.10 Lubricants and Other Petroleum Product Manufacturing

This industry sector produces a wide range of vital lubricant, grease, fluid, oil and bituminous

products used in running of vehicles, machinery and equipment, in the construction of roads and in

general manufacturing.

IBISWorld anticipates 2014-15 revenue of $1.7 billion, down 6.9% from the previous year due to a

drop in base stock prices and a decrease in mining levels partially offset by activity across a range

of transport industries, including road, rail, air and water transport.

Industry revenue is forecast to decrease at an annualised 2.2% over the five years through 2019-

20 to $1.5 billion.

3.1.2.11 Commodity Price Volatility

The downstream process manufacturing industry is strongly affected by changes in commodity

prices, either through higher prices for raw materials and feedstock, or lower prices for their own

products. Both factors have an impact on the bottom line for Western Australian enterprises in this

industry area, many of which are SMEs with already limited resources.

For those industries with mineral products as raw materials, falling commodity prices have a strong

impact on their revenue performance. In Western Australia the impact of petroleum prices on

petroleum refining and chemical manufacture, for example, is profound and until recently has

eroded profit margins, causing enterprises to consider relocation of facilities to countries with

cheaper labour costs.21 The 46.7 per cent drop in the price of crude oil to April 2015 has provided

some relief22 but the question of relocation to low cost economies remains.

The two most significant industry subdivisions in Western Australia, in terms of local industry

share, are nickel refining and alumina production, both of which are directly impacted by

commodity prices. As reported in the latest CME Economic Brief, nickel prices have fallen 26.1 per

cent in the 12 months to April 2015, almost negating the nickel price rebound in 2014, of 30 per

cent following Indonesia’s ban on exports of nickel ores.23

3.1.2.12 Residential Construction Activity

The construction training council estimated that approximately 24,000 construction industry

employees are working on resource industry infrastructure construction projects. Compared with

the estimated 29,000 employed in 2013, this decline in the workforce reflects the transition of the

resources sector from the construction to the operational phase24. As infrastructure projects are

completed and the industry continues its move towards a growing operational need, the population

growth will slow and with it dwelling commencements particularly in resource heavy regions, such

as the Kimberley and Pilbara. The decrease of 11,269 construction industry people in the

February25 quarter demonstrates this shift in activity, heightened by the downward trend of global

commodity prices and restructure within the resources sector as companies focus on improving

productivity and reducing costs. According to the 2015-2025 Western Australian Resources Sector

21

IBISWorld, C2543 Pharmaceutical Product Manufacturing 22

CME, Economic Brief, June 2015 23

CME, Quarterly Economic Brief, June 2015 24

Construction Training Fund, Industry Snapshot, May 2015 25

Construction Training Fund, Industry Snapshot, May 2015

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Outlook, the construction based workforce is expected to decline by 17,300 below 2014 levels in

2020 as the operational workforce increases26.

During 2013-14, the housing industry has experienced unprecedented growth in the housing sector

with the number of housing approvals to March 2015 reaching 31,528, with trend building

approvals in Western Australia rising by 6.8 per cent over the year27. Overall activity is expected to

remain relatively high.

For the downstream process manufacturing industry in Western Australia, construction activity has

an impact on demand for their products, coinciding with higher labour and operational costs. So

although annual growth from 20010-2015 in related industry areas mostly show a negative overall

trend, the combined revenue for these in 2014-15 totaled $13.5 billion, as follows:

Clay Brick Manufacturing -3.6 per cent

Concrete product manufacturing -1.5 per cent

Cement and Lime Manufacturing -2.5 per cent

Plaster Product Manufacturing 0.8 per cent

Ready mix concrete manufacturing 1.7 per cent28

3.1.2.13 Import Penetration from Asia

Projected economic and population growth in the Asian region are factors driving potential demand

for products and services.

The structural shift in global competition continues to see emerging-market economies gain

strength, particularly in East Asia which claims much of the outsourced manufacturing work. With

an increasing supply of skilled labour and lower operational and labour costs, overseas enterprises

are able to produce similar products at lower cost to the consumer, further eroding Australia’s

already-tight profit margins such as those affecting the soap and cleaning compound

manufacturing (10% decrease in annual growth 2010-2015) and the manufacture of plastic

injection molded products (4.3% decrease in the same period)29. Similarly some industry players

such as those in plastic foam product manufacturing are indirectly affected by import competition

through import penetration in their major downstream markets (6.1% drop).

A recent report notes as the pressure to lower manufacturing costs continues, Australia needs to

become a substantial contributor to global value chains through niche areas of advanced

manufacturing and value adding, characterised by unique technologies, skills and supply chains

that cannot easily be replicated by lower cost countries30. Remaining competitive with low-cost

destinations will require continued product and service innovation, research and development, a

highly skilled domestic workforce and policy changes to ensure a collaborative, robust and

prosperous economy.

3.1.3 Labour and Skill Demand

According to CEDA’s latest workforce report, in the decade to 2013-14, Australia’s manufacturing

employment decreased by 92,000 jobs31. Declines in employment levels are projected to continue

26

CME, 2015-2025 Western Australian Resources Sector Outlook, 2015 27

Construction Training Fund, Industry Snapshot, May 2015 28

IBISWorld, Industry Reports, 2014 29

IBIS World, C2566 Plastic Injection Moulded Product 30

CEDA, Australia’s future workforce, June 2015 31

CEDA, Australia’s future workforce, June 2015

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as industry adjusts further to changes in structural composition driven by technological

advancements, digital disruption and globalization of supply chains.

As the industry continues to transform and move towards lean, competitive, high-end

manufacturing, it will be increasingly dependent on a flexible, adaptable and highly skilled

workforce. The report points out the next wave of the industrial revolution will require life-long

learning, broad competencies and deeper technical skill development with workers needing deep

computer literacy and digital skills to grow their competitive advantage as the global supply of

skilled labour increases.

The challenge is to attract and retain skilled workers, increase the availability and supply of

specialist skills, and improve ongoing skills development and utilization. As completion rates for

science, technology, engineering and mathematics (STEM) degrees grow exponentially throughout

Asia, it is critical we develop and deepen STEM capability to meet deeper technical skill

requirements of the future.

Rapid advances in manufacturing technologies and techniques, increasing market globalisation

and an ageing workforce are other fundamental factors driving a need to develop and retain a

highly skilled and flexible workforce.32 This will require a coordinated effort by industry, the

education and training sector and government33 to ensure Australia’s governing education

regulatory framework and policies help workers develop the required skill sets34.

3.1.3.1 Identify the Workforce

Following the release of the employment data from the 2011 ABS Census of Population and

Housing it is possible to get a detailed overview of the shape of the workforce for the diverse

industry area of downstream process manufacturing, including laboratory operations.

According to the 2011 ABS Census, there were 27,562 people employed in the downstream

process manufacturing industry in Western Australia (approximately 2.5 per cent of Western

Australia’s total employment), with 50.3 per cent employed in the top five industry areas being:

1. Alumina Production (5323 Employed Persons)

2. Scientific Testing and Analysis Services (3517 Employed Persons)

3. Scientific Research Services (2087 Employed Persons)

4. Other Basic Non-Ferrous Metal Manufacturing (1773 Employed Persons)

5. Basic Inorganic Chemical Manufacturing (1175 Employed Persons)

The remaining 49.7 per cent of employed persons were spread across 45 further industry areas.

As such, this group of industries is very varied and presents very different workforce development

challenges. Appendix 3 shows a more detailed analysis of the sector’s workforce profile.

In terms of the share of employment across different occupation groupings, Figure 2 overleaf

indicates the share of employment for all downstream process manufacturing industry areas by

occupation.

1. Technicians and Trades 28 per cent

2. Machinery Operators and Drivers 20 per cent

3. Professionals 17 per cent

32

Manufacturing Skills Australia, www.mskills.com.au, accessed October 2014 33

AWPA, Ibid 34

CEDA, ibid

http://www.mskills.com.au/

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4. Managers 13 per cent

5. Clerical and Administrative Workers 10 per cent

6. Labourers 9 per cent

7. Sales Workers 2 per cent

Figure 2: Western Australian Downstream Process Manufacturing Workforce by Occupation

(ANZSCO 1 digit) Source: 2011 Census of Population and Housing

In comparison with the mining and oil and gas industries, the occupational mix for the downstream

process manufacturing sector is very different. Professionals have a much higher occupational

share for process manufacturing which is expected given the nature of these industries.

Drilling down on the occupational distribution of the top five employing process manufacturing

sectors shows the following:

13%

17%

28%

0%

10%

2%

20%

9%

1% 0%

0%

WA Downstream Process Manufacturing Workforce by Occupation

Managers

Professionals

Technicians and TradesWorkersCommunity and PersonalService WorkersClerical and AdministrativeWorkersSales Workers

Machinery Operators andDriversLabourers

Inadequately described

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Table 1: Western Australian Downstream Process Manufacturing Industry Workforce by

Occupation - Comparison of Downstream Process Manufacturing Industry Sub-divisions Source: 2011 Census of Population and Housing

Ma

na

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rs

Pro

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sio

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ls

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nic

ian

s a

nd

Tra

de

s W

ork

ers

Co

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ity a

nd

Pe

rso

nal

Serv

ice

Ws.

Cle

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al

an

d A

dm

inis

tra

tiv

e W

ork

ers

Sa

les

Wo

rke

rs

Ma

ch

ine

ry O

pe

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rs a

nd

Dri

ve

rs

La

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ure

rs

Ina

de

qu

ate

ly d

esc

rib

ed

No

t s

tate

d

No

t a

pp

lica

ble

Total Downstream Process

Manufacturing

3457 4626 7730 113 2715 568 5640 2353 324 34 0

Alumina Production 329

(9.5%)

731

(15.8%)

1888

46 295 4 1571 391 64 5 0

Scientific Testing and Analysis

Services

374

(10.8%)

858

(18.5%)

1505 12 381 16 134 183 46 10 0

Scientific Research Services 280

(8.1%)

1264

(27.3%)

239 9 236 11 12 21 16 0 0

Other Basic Non-Ferrous Metal

Manufacturing

128

(3.7%)

290

(6.3%)

557 20 122 0 588 41 28 0 0

Basic Inorganic Chemical

Manufacturing

143

(4.1%)

219

(4.7%)

421 4 121 4 199 45 17 0 0

The table above shows the occupation profile of the Western Australian downstream process

manufacturing workforce for the five different industry sub-divisions that employ 50 per cent of the

total workforce for process manufacturing.

3.1.3.2 Sourcing the Workforce

Manufacturing in Australia is highly co-dependent on key industries such as mining, agriculture,

services, utilities and transport and further affected by high labour costs and the exchange rate.

More than 60 per cent of manufacturing employment is characterised by small and medium sized

businesses (SMEs) with a large presence in low-medium technology areas. As outlined in the

latest MSA e-scan, around 43 per cent of manufacturing businesses within the MSA scope are sole

traders that have no employees and almost half are small businesses employing between 1 to 19

people35.

With global value chains seeing a shift in labour-intensive activities toward lower cost economies,

in order to create a sustainable and competitive industry, Australia’s manufacturing needs to

35

Manufacturing Skills Australia, Environmental Scan 2015

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expand niche areas to produce innovative offerings and increasing productivity and maximize our

strengths in advanced skills and expert knowledge.

As we move toward an ever increasingly automated, robotic environment with a focus on

performance and productivity, design-led innovation and product development, rapid technological

change, changing consumer demand, global competitiveness and supply chains, we will be faced

with a series of challenges.

Companies are faced with an increasing need to assess the operational, strategic and technical

aspects of their business if they are to penetrate global value chains. Resulting high-level technical

and management skills needed in process manufacturing and laboratory operations sectors will

prove difficult to source in traditional labour pools across Western Australia and across the nation.

Already respondents in the latest e-scan have raised this as a key priority, citing a shift towards

higher level technical skills (82%), innovation/design skills (70%), multi skilled, broad-based

capabilities and digital skills (59%) and a need for a flexible workforce with higher level

interpersonal and organisational skills and capable of creative thinking36.

The Australian and state governments recognise the need to attract foreign investment into the

industry and the urgency for skilled, multilayered workers capable of transitioning skills and

applying knowledge. The recent Innovation and Competitiveness Agenda reflects the

commonwealth government’s focus on improving global competitiveness by lowering production

costs, improving skills, delivering more infrastructures, driving entrepreneurship and reducing

regulatory processes. Likewise, the Industry Skills Fund supports growth of specialised skills and

the need for multi-skilling, through to management levels, particularly in the SME sector of the

industry. Both initiatives aim for greater industry collaboration, innovation and research and

development which are critical for sustainable, global competitiveness and growth.

3.1.3.3 457 Visas

When resource sector activity has high, companies in downstream process manufacturing turned

to overseas labour to fill specific high priority skill needs that were unable to be met by local

Australian workers. In 2011-2012 the number of 457 visas granted more than doubled for the

manufacturing industry and the professional, scientific and technical industry groups in Western

Australia. In the current climate, visa requests and visas being granted have decreased

significantly, however as reported in the 2015 e-scan companies turn to 457 visas to address skill

shortages particularly to meet niche and specialized work demands even though the preference is

to build Australian long term workforce capacity and capability and employ locals.

In the past process manufacturing firms have noted historical difficulties in accessing the 457 visa

program due to limitations in the occupational classification system (ANZSCO). According to

AWPA’s manufacturing study, skills shortages exist in a number of trades occupations relevant to

the manufacturing sector, including metal machinists (first class), fitters (regional shortage) and

sheetmetal trades workers.

3.2 Regional Impact

Although a third of manufacturing workers were employed in regional and remote areas of the

country in 2013, the majority of process manufacturing and laboratory operations are traditionally

located in metropolitan hubs such as Kwinana, south of Perth. Although these areas are readily

accessible for residential workers located in the city, alternative arrangements are needed to

attract and retain a skilled workforce to meet the needs of a changing manufacturing industry.

36


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3.2.1 Regulatory Requirements

The diverse nature of the downstream process manufacturing industries in WA means that they

operate in different regulatory systems. Below is a short overview of key issues facing certain

industry sub-divisions.

3.2.1.1 COAG Reform Agenda: Plastics and Chemicals

As part of the COAG national reform agenda, one of the areas under scrutiny is regulatory systems

in the chemical and plastics industries37. The Productivity Commission has completed a study into

regulation across these industry areas and has produced some recommendations for improved

activity, to which the Plastics and Chemicals Industries Association (PACIA) has also contributed.

At its October 2014 meeting, COAG agreed to consider changes to the regulatory framework

governing chemicals to improve its efficiency, with the Standing Committee on Chemicals to

recommend a reform pathway to COAG by the end of 2014. The National Industrial Chemicals

Notification and Assessment Scheme (NICNAS) review was aimed at streamlining the assessment

process for industrial chemicals to reduce the regulatory burden on the chemicals sector whilst

maintaining safety standards.

There are three main regulatory issues for these industries are:

1. Dangerous goods regulations;

2. National Industrial Chemicals Notification and Assessment Scheme (NICNAS) plans for

chemical screening; and

3. The NICNAS review.

PACIA has also held regular Regulatory Affairs Network meetings across the country to facilitate

discussions on this topic and endeavour to expedite the reform implementation process. NICNAS

reforms are being progressively implemented and are expected to be completed by 1 September

2018. These reforms are also being implemented on a cost recovery basis from industry.

3.2.1.2 National Association of Testing Authorities (NATA) – Changes to Construction Materials

Testing (CMT) Accreditation

The National Association of Testing Authorities (NATA)38 is recognized as the authority on quality

and independent assurance of technical competence for laboratories and scientific testing facilities

across Australia. Independent assessors are contracted by NATA to undertake regular inspections

and audits of laboratories to ensure that the services rendered meet national and international

standards.

NATA also represents Australia at the global level, through participation in the International

Laboratory Accreditation Cooperation (ILAC), the Asia Pacific Laboratory Accreditation

Cooperation (APLAC) and the OECD Working Group on Good Laboratory Practice.

Recently, NATA has announced that in the construction materials testing area, authorized

signatories, understood to be laboratory technicians and managers accredited by NATA, require

certain qualification levels to retain their NATA-accredited status. Different occupation levels relate

to different VET qualification levels, mapped to the Australian Qualifications Framework (AQF).

At the RITC Laboratory Operations Forum in March 2012, representatives from NATA indicated

that the Australian Qualifications Framework will be increasingly used as a measure in recognising

authorized signatories across all areas of its business. The recent removal of funding for existing

37

http://www.pc.gov.au/__data/assets/pdf_file/0017/82331/chemicals-plastics-regulation.pdf 38

http://www.nata.asn.au/

http://www.pc.gov.au/__data/assets/pdf_file/0017/82331/chemicals-plastics-regulation.pdf

http://www.nata.asn.au/

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workers undertaking laboratory operations qualifications may result in a hindrance of workers

undertaking required qualifications to meet the NATA requirements, causing a shortage of required

skills into the future. As highlighted in the 2015 environmental scan, existing workers need access

to training opportunities in order to become multi-skilled, improve manufacturing practice, build

management and leadership capability and refresh trade skills to maintain their currency39.

3.2.1.3 Impact of OSH Harmonisation

For certain hazardous materials, such as explosives, it is likely that the current process to

harmonise workplace safety and health legislation across the different states and territories will

have an impact upon operations. Safe Work Australia has released an explosives regulation in

Australia discussion paper and consultation regulatory impact statement for public comment (as at

August 2015). Safe Work Australia has highlighted significant variation across the states and

territories in the following areas:

Definitional issues regarding explosives;

Licensing arrangements; and

Notification requirements.

These variations have the potential to create complexity for industry and impose administrative and

cost burdens on businesses, particularly those operating across jurisdictions.

3.3 Gender/Age Participation

3.3.1 Gender Diversity

Process manufacturing in particular has been traditionally seen as a male-dominated industry, with

a higher proportion of males than females working in the industry in Western Australia. There is

significant variance in the levels of female participation across the different industry areas that

comprise downstream process manufacturing. The average participation rate for the process

manufacturing group of industries of 21.19 per cent, compared to the Western Australian all-

industry female participation rate of 45.28 per cent40.

The table in Appendix 4 not only indicates the variance in terms of female participation, but also

the concentration of employment in several key areas, such as alumina production and scientific

testing and analysis.

A 2011 report on female participation in the manufacturing industry from the Equal Opportunity for

Women in the Workplace Agency (EOWA) published a female participation rate of 26.8 per cent

compared to an all-industry total of 47.9 per cent41.

In 2011-12 the sector experienced a rapid period of innovation, in response to new industry

demands notably from the resources sector, as well as structural changes due to import

penetration42 from China and other neighbouring countries.

39

Manufacturing Skills Australia, 2015 Environmental Scan 40

ABS, 2011 Census of Population and Housing 41

http://www.eowa.gov.au/Information_Centres/Resource_Centre/EOWA_Publications/Industry_Verticals/2011/Manufactur

ing.pdf 42

Cited as an issue in numerous IBIS World reports on Process Manufacturing subdivisions, including: C2534 Ethylene,

Propylene and other Organic Chemicals, C2543 Pharmaceutical Product Manufacturing, C2610 Glass and Glass

Product Manufacturing and C2623 Ceramic Tile and Pipe Manufacturing

http://www.eowa.gov.au/Information_Centres/Resource_Centre/EOWA_Publications/Industry_Verticals/2011/Manufacturing.pdf

http://www.eowa.gov.au/Information_Centres/Resource_Centre/EOWA_Publications/Industry_Verticals/2011/Manufacturing.pdf

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The growth of the composites industry has relied upon high research and development and

innovation, with a strong move towards automation and nanotechnology. More recently, as noted

in the AWPA manufacturing study – April 201443, skills, work patterns, leadership models and

culture might need to change to support an integrated operations approach to optimising the

benefits from technology. The ability of enterprises to offer more flexible working arrangements

could also attract more women to these industries.

The differences in female participation rates could also be linked to the para-professional and

professional occupation ratios of this sector, with a higher proportion of laboratory workers having

a tertiary level qualification (ABS Education and Work, November 2011).

After two years of research, the Committee for Perth has released its findings on the state of

gender equality in Western Australia with findings showing that more work needs to be done.

The Filling the Pool report identifies 31 recommendations to increase and support women’s

workforce participation and progression in the state and narrow the gender pay gap, including

greater job flexibility, better access to childcare, succession plans linked to greater diversity,

targeted training and development activities, sponsorship and mentoring programs, increasing the

number of girls undertaking STEM subject at school, and more meaningful equality targets. They

report on the importance of mentors, particularly female role models, in traditionally male

dominated industries such as manufacturing to provide meaningful advice, inspiration and

opportunity44.

3.3.2 Workforce Age Profile

The age profile of Western Australia’s downstream process manufacturing workforce is shown

below based on the 2011 Census.

Figure 3: Western Australian Downstream Process Manufacturing Workforce Age Profile Source: 2011 ABS Census of Population and Housing

A strong proportion of the process manufacturing workforce is aged 25-54, with a further 7 per cent

43

AWPA, Ibid 44

Committee for Perth, Filling the Pool Report, June 2015

2.47% 7.79%

11.50% 11.70%

12.72% 13.53%

12.98% 11.78%

8.46% 5.36%

1.71%

15-19 years20-24 years25-29 years30-34 years35-39 years40-44 years45-49 years50-54 years55-59 years60-64 years65-69 years

WA Downstream Process Manufacturing Workforce Age Profile

http://thechamberofmineralsandenergyofwesternaustralia.cmail1.com/t/j-l-dudjtkk-mqwtdkl-a/


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aged 60-69 which indicates an ageing workforce in these industries. In 2012-13, 34.1 per cent of

the manufacturing workforce was aged up to 35 years45.

This issue is made worse within the context of potential retirements, with 27.4 per cent of the

industry workforce being aged between 50 and 69 years of age. As reported in the 2015 MSA

Environmental Scan, ageing workforce and looming retirements continue to be the key challenge

facing the manufacturing industry46. The potential loss of experience and operational knowledge is

considerable and indicates the need for pre-emptive action in terms of ensuring appropriate

transfer of knowledge to younger staff through training and mentoring. According to MSA a

significant focus on skills and training is needed to mitigate the long term risks of skill shortages

and attrition, with the sector reporting a significant gap between the capabilities of older,

experienced workers and the younger cohort in the sector47.

It is critical young people are attracted to the industry to create the next wave of manufacturing

leaders and innovators and maintain a sustainable and prosperous economy. VET could offer an

entry into the sectors, either through VET in Schools programs, or traineeships that would train

young people in the basic skills necessary to enter the industry and build its workforce capacity.

This cohort of potential workers can provide opportunities for technical innovation and up-skilling of

existing workers into more senior or supervisory and management roles. A new set of traineeships

and pilot programs are in the pipeline in collaboration with schools, training providers and industry

to assist young people moving into the industry which should raise industry profile and increase

participation.

While Figure 3 outlines the age profile of these industry areas as a collective, additional analysis

for the top five employers by industry area was undertaken to show the varied age profiles within

the industry (Figure 4).

Figure 4: Western Australian Downstream Process Manufacturing Workforce Age Profile

Source: 2011 Census of Population and Housing

45

AWPA, Ibid 46



0.00% 5.00% 10.00% 15.00% 20.00%

15-19 years20-24 years25-29 years30-34 years35-39 years40-44 years45-49 years50-54 years55-59 years60-64 years65-69 years

WA Downstream Process Manufacturing Workforce Age Profile

Basic Inorganic ChemicalProduct Manufacturing

Other Basic Non Ferrous MetalProduct Manufacturing

Scientific Research Services

Scientific Testing and AnalysisServices

Alumina Production

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3.3.3 Under-represented Groups Participation

The under-representation of Indigenous Australians in the Western Australian workforce is also

significant, despite recent attempts by government to encourage broader engagement with

Aboriginal people through the Training Together Working Together initiative. The table in Appendix

5 outlines the Indigenous workforce participation rate in the Western Australian downstream

process manufacturing industries, mapped to total employment figures across the industry.

It should be noted the average Indigenous participation rate in the Western Australian downstream

process manufacturing industries is 0.98 per cent. However, additional Census analysis

undertaken by CME indicated that in the 2011 ABS Census of Population and Housing there was a

relatively high proportion of people in Western Australia who did not state whether they were

Indigenous or not in the 2011 Census (5.9%). While this proportion may not seem high it’s more

than double the proportion who identified as being Indigenous (2.5%) in total.48 As such, the low

figure of 1 per cent should be placed within this context of self-identification and broader

methodological issues with the Census.

Various reports have identified a concentration of Indigenous Australians in lower skilled jobs, a

direct result of low participation in post-school education. This was also noted in the Forrest

Review report, Creating Parity, which advocated for a greater focus on improving the educational

attainment of Indigenous Australians which is fundamental to a greater participation of Indigenous

Australians in employment. As the review report states, whichever way you look at this, only

employment will end the disparity and employment is only possible if we remove all impediments to

parity in education49.

Much remains to be done on the issue of progressing Indigenous Australians into higher level job

roles. The use of automation, innovative technologies and an increasing level of activity-generated

data used to improve processes is creating a morphing sector, progressively more reliant on higher

skills.

3.4 Major Challenges and Barriers

3.4.1 Quality Flexible Training Options and Delivery

Persistent concerns remain regarding deficiencies in the quality of training delivery and

consistency of outcomes. According to the 2015 Environmental Scan, flexibility in training options

and delivery are critical to the manufacturing workforce in order to meet the skill priorities of the

sector, particularly in relation to training options for niche and thin markets into emerging and

advanced manufacturing opportunities in some downstream manufacturing areas. The scan has

found enterprises are keen for a system which addresses current and future skill needs, one which

assists with recruitment, workforce planning, career progression, skills recognition, development

and transition … [wanting] predictability, consistency, quality and flexibility, delivered through full

qualifications, skill sets and training on demand50.

Fundamental to raising quality from a delivery standpoint is a recasting of relationships between

industry and RTOs. It is incumbent upon industry to enter into negotiations with RTOs on an

informed basis - to understand their rights and to be clear with RTOs regarding expectations of

performance. It is also necessary for RTOs to understand the industry, its context and the practical

considerations that will determine issues such as delivery and assessment.

48

The Chamber of Minerals and Energy of WA; Statistical Summary, unpublished 49

The Forrest Review, Creating Parity, 2014 50


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3.4.2 Relevance of Qualifications and Funding

As the manufacturing environment becomes more sophisticated and technologically savvy to

maintain global competitiveness and currency, innovation is critical as are the skilling needs of the

industry to meet this end and increasingly, this is not aligning with a qualifications paradigm. In

some cases, the jump between units of competence and qualifications is too great with some

qualifications remaining too big for roles in industry. From a workforce development perspective, it

may be more appropriate for workers to have a base qualification (eg, Certificate II) and then

access skill sets as they progress to operate different equipment with a notion of a certain number

of skill sets equating to award of a higher level qualification.

In Western Australia, this is inconsistent with system force to course enrolment processes and

requirements. In addition, Western Australia is currently not reporting skill set activity.

This is compounded by the issue of thin markets in regional Western Australia. The RITC will be

conducting a project to trial an approach to skill sets in a regional setting as a means of increasing

VET activity and engaging industry.

Conversely, enterprises have also voiced their concerns for the removal of funding for existing

workers and the lack of funding for VET Fee Help for Certificate IV as this limits skilling

opportunities for workers in an environment which is calling for greater leadership and

management capability and multi-skilled, adaptable workers capable of problem solving and

innovative thinking51.

3.4.3 Industry Cost Competitiveness

It is not just the mining industry that is experiencing challenges with cost competitiveness. Labour

and input costs are impacting the Western Australian downstream process manufacturing sector

across the board. For the manufacturing industry to become sustainable and improve its global

competitiveness, it needs to focus on increasing efficiencies and productivity, advanced and

emerging sectors and address some of the challenges in terms of capacity, skill development,

access to markets and ability to link with R&D opportunities and other resources52.

3.4.4 Accessing a Skilled Workforce

The downstream process manufacturing workforce across Western Australia continues to

experience challenges in accessing a flexible and highly skilled labour force. The workforce

pressures which had been driven by the resources needs have eased and are now characterised

by technologically driven skills for an increasingly advancing manufacturing industry. As pointed

out in the 2015 MSA e-scan, the changing workforce characteristics have many implications for

workforce development and will need new approaches to attracting and retaining staff across all

levels, improving career path opportunities and provision of a variety of skill development programs

to ensure continual up-skilling opportunities. This will be explored in more detail in a section below

titled New and Emerging Skills.

The RITC will continue to work with employers and training providers to evaluate the extent of the

shortage and promote different strategies to mitigate this, including greater training and workforce

development opportunities, especially for younger Australians, more mature Australians and under-

represented groups such as women and Aboriginal Australians.

51



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3.4.5 Science, Technology, Engineering and Mathematics (STEM) Skills

Education and training needs to prioritise STEM participation, achievement and capability to meet

industry’s changing skill needs towards higher level technical and critical thinking skills. These

skills are fundamental in shaping future manufacturing and are already embedded in 75 per cent of

the world’s fastest growing occupations53. As outlined in the scan, a recent study has forecast

occupations with a high science and maths field of study are growing at almost double the rate of

jobs with low science and maths skill requirements.

Boosting STEM participation and completion rates will achieve greater innovation, productivity and

application of technical knowledge which in turn will improve Australia’s position against

international competition and growing global education levels. The national STEM agenda places

science at the centre of industry policy and supports a modern, flexible and highly skilled future

workforce, capable to adapt to change and capitalize on opportunities54. It should also have a

positive impact on youth employment outcomes with skills more closely aligned with the needs of

industry.

In 2014, the Technology and Industry Advisory Council (TIAC) released a report addressing the

optimisation of STEM education in Western Australian schools55. Importantly, this work identified

STEM challenges in schools and made recommendations for change. The diagram below,

illustrates the key STEM issues and challenges facing the education system.

Figure 5: Key school education factors limiting the development of a STEM capable

workforce Source: TIAC, Optimising STEM Education in WA Schools, February 2014, p10

3.4.6 Innovation, Research and Development

According to MSA’s latest e-scan, manufacturing accounts for a quarter of total annual business

research and development (R&D) expenditure in Australia yet holds only two per cent of global

R&D. In order for the industry to gain commercial gains from innovative ideas on a global scale, it

needs to collaborate with universities and research bodies for commercialising innovations amidst

a local regulatory environment supporting these pursuits. This is particularly important given

53 Manufacturing Skills Australia, Environmental Scan 2015 54 Manufacturing Skills Australia, Environmental Scan 2015 55

TIAC, Optimising STEM Education in WA Schools, prepared by Edith Cowan Institute for Education Research,

February 2014

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Australia’s unique manufacturing composition and number of small to medium sized enterprises

which individually have limited capacity for such collaboration. According to the MSA report, 92 per

cent of Australian business leaders believe they would be more successful at innovation through

partnership and collaboration. The sector also needs to improve its ability to commercialise

innovation, with Australia ranking 116th out of 142 countries for converting research dollars into

innovation outcomes56.

The outlook is optimistic with governments committed to providing the right economic incentives to

enable businesses to grow as seen through the Industry Innovation and Competitiveness Agenda

and the commitment to the establishment of the advanced manufacturing growth centre as a way

to foster innovation, entrepreneurship, commercialisation and address capability of the sector.

3.4.7 Language, Literacy and Numeracy Skills

Low levels of language, literacy and numeracy (LLN) skills are being increasingly recognised as an

issue across Australia. The 2013 Australian Workforce and Productivity Agency (AWPA) National

Workforce Development Strategy noted around 6 million Australians have “less than the minimum

prose literacy skills required to function fully in life and work”57. From an employer’s perspective,

LLN issues can impact upon a worker’s capacity to undertake their job role in a safe and

productive manner, however many workers have unidentified LLN issues which have an ongoing

impact on their work practices and productivity.

3.5 New and Emerging Skills

A new report by the Committee for Economic Development of Australia (CEDA)58 explores

Australia's future workforce, demonstrating how the shift towards technology is growing industry

sophistication and making sectors progressively more reliant on higher skills. Implementation of

technology, automation and data impact the deeper technical skills and capabilities needed to

ensure sustained international competitiveness and growth into the future.

For Australia to have an innovative, flexible, skilled and capable workforce it needs to boost

participation and completion rates in STEM subjects (science, technology, engineering and

mathematics), an issue raised in both MSA 2014 and 2015 environmental scans. As noted in the

MSA 2014 environmental scan:

Furthering development of advanced manufacturing technologies relies on high-

level application of STEM skills, as well as the ability to integrate advances into

manufacturing practice. As these technologies become more widespread, skill

development needs will increase in technology-driven design and operation.

Enterprises also need to continually develop their human capital to ensure

workplace practice maximises productivity and efficiency gains.59

According to the 2015 scan, in order for Australia to be innovative and grow its competitive

advantage it needs a workforce with the capacity to adapt and adopt new skills through education,

particularly given the rapid rise of STEM higher education degrees awarded in South East Asia60.

MSA sees the next wave of the industrial revolution centered around life-long learning amidst niche

areas of advanced manufacturing characterized by unique technologies, skills and supply chains

56

MSA, 2015 Environmental Scan 57

AWPA, National Workforce Development Strategy, March 2013, Pg. 12 58

CEDA, Australia’s Future Workforce, June 2015 59

MSA ibid 60

MSA, Environmental Scan 2015

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that cannot be easily replicated by lower cost countries61 as well as greater computer literacy as

the new norm. Leadership and management also play a key role in this equation as do stronger

outcomes for research and development capabilities.

As identified in the 2014 scan62 niche, specialised, high quality globally oriented manufacturing is

an area where Australian can develop a competitive edge. Locally that has been demonstrated

through a servicing of resource project related demand. MSA defines the skill implications for this

as follows:

Manufacturers need high-level technical skills in specialised areas. They need

solid design and creativity skills and ability to market their products and establish

brand identity. Knowledge-intensive products will require access to training in thin

markets and continual upskilling to ensure the latest best practice is applied in

operations. Often these enterprises are micro sized or small, adding further

challenge to achieving training viability for RTOs and enterprises. Micro-

multinationals also need skills in navigating and developing global markets and

ability to perform in the digital economy. Lean and agile production management

capabilities are also critical.63

Customer driven, service orientation and value adding are also themes explored in the MSA

environmental scans. The 2015 scan points to skill priorities which include:

computer proficiency

data analytics and programming

higher-level interpersonal/organisational

creative thinking and problem solving across a range of contexts and applications

logistics, procurement and supply chain management

project management

marketing, sales and industrial networking

61 MSA, Environmental Scan 2015 62

MSA, Manufacturing: It’s in our national interest, 2014 63

MSA, Ibid

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3.6 Occupations in Demand (ANZSCO Code)

Submission to SPOL 2015 – Focus List

ANZSCO Occupation Comments

233512 Mechanical

Engineer

In terms if RITC coverage, mechanical engineers are

employed across the mining, oil and gas and

downstream process manufacturing industries. Typically,

mechanical engineers are engaged in large numbers

during the design and initial construction of resources

projects. Despite this demand for mechanical engineers

will continue during the production and maintenance

phases as projects transition from construction over the

short to medium term.

Although WA has one of the highest retention rates for

engineers in the country, only about 60 per cent of

engineers are employed in recognized engineering

occupations, many moving away from practicing directly

in their discipline into senior management positions

particularly in the resources sector. Together with the

breadth of occupational reach and decline in recent

university graduates, these have led to employers

expressing difficulty in recruiting competent, experienced

mechanical engineers across resource sector projects

and turning to migration as a source of skilled

mechanical engineers.

233513 Production or Plant

Engineer

It is likely this occupation will remain in high demand over

the next five years as more projects become operational

across the country in both mining and oil and gas

industries. In a world of rapid technological change, the

need for experienced production engineers is critical as

the mining industry ramps up production, the oil and gas

plants come online and manufacturing employs

engineers across most industry areas for their wide

range of analytical and problem solving skills to propel it

into the next growth area in the Australian economy.

Given the extensive education, specialization and

experience required for employment into these roles,

production and plant engineers will remain in high

demand particularly across onshore and offshore

production and processing operations. As Australia’s

mining and oil and gas industries continue the transition

into production, these roles will become increasingly

critical and reliant on migration to meet demand.

233612 Petroleum Engineer There are shortages for skilled and experienced

petroleum engineers to work in offshore and onshore

operations and with seven LNG plants being

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commissioned between 2015 and 2018, demand for

petroleum engineers is expected to remain high.

According to Engineers Australia, in 2013-14 permanent

visas granted petroleum engineers increased by close to

20% and in the absence of local supply meeting demand

(particular in relation to experience) industry will rely

upon skilled migration as a primary mechanism for

meeting its demand. Recent anecdotal industry evidence

suggests petroleum engineer salaries have increased at

a higher rate than other oil and gas professions,

providing evidence of shortages in the industry. Similarly,

the Hays Quarterly Report October – December 2014

forecast Australia to be on the verge of an exceedingly

tight labour market for some highly skilled professionals

in high skill industries, including petroleum engineers,

maintenance and production supervisors with

instrumentation technicians and heavy diesel fitters

particularly sought after in Western Australia.

341111 Electrician (general) As the projects transition into the operations phase

electricians will still be in demand for maintenance

positions, particularly those holding engineering based

electrical qualifications. Given the number of projects

under construction and operation in Australia (8 mega

projects under construction in Australia, valued at more

than $5 billion and 44 projects at the Committed Stage

with a combined value of $228 billion, of which $116

billion is in Western Australia), the significant number of

electricians in training will result in critical shortages in

the period 2015 to 2018. Already enterprises have

expressed difficulty in recruiting experienced electrical

workers, complementing their existing trade

apprenticeship programs. Increasing use of technology

on resources projects will see strong demand for

electrical and instrumentation skills continue into the

medium to long term. It can be expected to intensify in

the longer term.

341112 Electrician (special

class)

Electricians (special class) play a crucial role in large

scale projects, in particular those in the resource

development sector, where they maintain the raft of

electrical infrastructure on site. With the introduction of

new technologies to mitigate operational costs, the skills

of electricians and instrumentation tradespeople for

installation and maintenance purposes will continue to

grow. Enterprises have expressed difficulty in recruiting

experienced electrical/instrumentation workers.

According to AWPA’s Resources Sector Skill Needs

2013 report, electricians comprise 3% of total mining

industry employment. As projects commence operations

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(particularly oil and gas projects) demand for special

class electricians is anticipated to remain firm. Given the

number of projects under construction and operation in

Australia the significant number of electricians in training

will result in critical shortages in the period 2015 to 2018.

399211 Chemical Plant

Operator

Chemical plant operators will be in very high demand,

especially in highly technical processing and refining

environments across WA. The numbers of these facilities

are likely to increase considerably in the next few years,

ramping up demand for skilled operators. If the recent

falls in the oil price translate into reductions in energy

input costs for a number of chemical and related

manufacturing sectors, increases in activity may also

drive demand for chemical plant operators.

Consultations with the Kwinana Industries Council (KIC)

has identified that chemical company employers within

the Kwinana heavy industry zone have reported

recruitment difficulties for process plant operators.

Significant and rapid expansion of Australia's LNG sector

has seen skill shortages continue for experienced LNG

process plant operators. The current seven LNG trains

in operation across Australia are expected to increase by

another 14 trains by 2016 as the sector enters further

production. With oil and gas operating companies

reporting international skill shortages for LNG process

operators, it is likely that chemical plant operators may

pursue opportunities in the LNG sector.

399212 Gas or Petroleum

Operator

Operators in the oil and gas industry will be in very high

demand over the next few years, from upstream oil and

gas production operations, to LNG production and

petroleum refining. Highly skilled and experienced

process operators, with knowledge of the oil and gas

industry, have consistently been in short supply and it is

estimated the number of skilled LNG plant operators

required for Australia’s new plants will increase the

current supply of operators at least six fold over the next

3-5 years, exacerbated as the number of LNG

processing facilities and upstream oil and gas production

facilities increases across Australia.

As reported in AWPA’s Resources Sector Skills Needs

2013, Deloitte Access Economics modelling projects

shortages in several professional and technical and trade

occupations as oil and gas operations move into

production capacity between 2015 and 2018, one of

which is gas, petroleum and power generation plant

operators. By 2018 Australia’s installed LNG capacity will

be around 86 million tonnes. LNG plant operators are

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highly skilled with a period of around 4-5 years post initial

qualification experience being seen as a minimum before

an LNG operator can work unsupervised.

These shortages are particularly concerning given the

significant investment profile of liquefied natural gas

projects (LNG). Already there is evidence that skill

shortages are affecting the competitiveness of Australian

LNG prospects by contributing to delays and increased

project costs. Wage growth reflects the difficulty in

obtaining suitable candidates for given occupations and

the overall lack of supply. Oil and gas operating

companies indicate operator salaries have been

increasing at a greater rather than CPI and increases

have been well above the vast majority of VET qualified

job roles in the sector.

In addition to the focus list, the following were also submitted within the non-focus list:

Submission to SPOL 2015 – Non Focus List


233111 Chemical Engineer Shortages of engineering professionals and chemical

engineers in particular are clear across the three RITC

industry areas. The raft of projects in the pipeline indicate

that the specialist and technical knowledge of chemical

engineers will be in demand across the state, as

evidenced by industry consultation and the considerable

number of job advertisements for this occupation online.

Engineering skill shortages are common in the WA

resources sector across multiple disciplines. The time lag

for graduate engineers to progress to skilled

professionals is also a factor for resource sector

companies.

234211 Chemist There are consistent shortages across RITC industries

for technically competent and experienced chemists, who

are in high demand across the state in the mineral and

hydrocarbons industry and the downstream process

manufacturing industry, with particular emphasis on the

manufacture of organic and inorganic chemicals.

Forecasts for skilled labour across Australia suggests

chemists will long be in high demand by the industry.

Skilled labour is a supplement to this issue in the short

term but in the long term encouraging science as a

career pathway should be encouraged.

311411 Chemistry

Technician

Chemistry and laboratory technicians work closely with

laboratory managers or supervisors to carry out the

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specialist testing requirements of the laboratory's clients

fuelled by the demand from WA’s mining industry for

mineral assay laboratories or more generally in forensic,

pathology or food testing laboratories. The ageing

population will see a greater demand for medical testing

and analysis to be performed and this will higher level

laboratory skills.

The current transition from construction to operations

across the resources sector will cause significant

increase in demand for laboratory services associated

with assaying and QA of mineral products. Also, industry

activity in the upstream resource sector, which is a key

source of business for the laboratory operations industry,

is a strong indicator that demand will continue.

An increasing focus on technology (automated sample

analysis) is changing the nature of qualifications

demanded by industry. In automated laboratories, the

bias in qualifications is moving towards higher level VET

qualifications with these people being typically

supervised by a tertiary qualified professional. This is

not reflected well in the SPOL.

511111 Contract

Administrator

As reported at the 2015 AOG conference, some roles

which do not have a standard qualification, such as

contract administrators or contract or procurement

managers, are crucial roles within a project. A 2014

report by Ernst & Young, Five things – Getting the basics

right in procurement, observe that there continues to be

a mismatch in the supply and demand of high quality

procurement professionals in the market and believe that

the market fundamentals will not change in the short

term. These administrators are fundamental enablers of

business strategy for achieving sustainable cost

reductions. In a marketplace with low commodity prices,

new contract and project management strategies are

needed to manage major projects in the resources

industry. Skilled administrators improve productivity and

the bottom line through improvements in workplace

practices which result in operational efficiencies. They

are critical to achieving supply chain optimization. As

reported by Mining Australia companies are faced with

developing solutions to meet reduced operating and

maintenance budget without compromising on quality,

safety and equipment performance. The 8 mega projects

under construction in Australia have significantly

increased the demand for experienced project managers

and administrators. It is now that investment needs to be

made in supporting pathways for project administrators

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and managers to ensure that we have necessary stocks

of experience to deliver the next phase of investment in

Western Australia's resources sector.

511112 Program or Project

Administrator

AWPA report and The October 2013 BREE Resources

and Major Projects report contain information that is

relevant to this occupation. According to the BREE

report, of committed investment in 2008, only 34 per cent

of investment was in "mega projects" (projects over $5

billion). By October 2013 this proportion had more than

doubled to 82 per cent. This shift towards mega projects

has significantly increased the demand for experienced

project managers and administrators. It is now that

investment needs to be made in supporting pathways for

project administrators and managers to ensure that we

have necessary stocks of experience to deliver the next

phase of investment in Western Australia's resources

sector.

591116 Warehouse

Administrator

The transition from construction to operations across the

resources sector will alter the skills mix required by the

sector. The production phase will bring increased

operational requirements that will cause an increase in

demand for warehousing facilities and associated

occupations such as warehouse administrators. The

likelihood of a marine supply base being established in

the Kimberley to deal with FLNG projects off Western

Australia will create further regional demand for

warehouse administration occupations.

In addition to these occupations, the following have been identified as being of priority to the

industry:


311000 Laboratory

Manager

Laboratory managers work across a wide range of

industries including mining, construction, health,

professional services and education. They work closely

with and supervise chemistry technicians working in

laboratories. The shift of the resources industry moving

into operations, industry activity in the upstream

resources sector, higher skills required in more

automated laboratories and the demands of an ageing

population will continue to drive the need for laboratory

managers across industry groups.

3.7 Workforce Development Opportunities

Each year the RITC undertakes annual strategic project work to address current and emerging

skills and workforce development issues in the Western Australia resources sector.

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The automation report involved targeted consultations with Western Australian stakeholders to

evaluate the potential impacts of automated technology on the WA resources sector and the skills

implications for the Western Australian workforce. The outcomes of the automation project in

particular, emphasized the demand for higher level skills in the Western Australian resources

sector. This is in line with the COAG targets for national skill reform, in terms of doubling the

number of higher qualification (diploma and advanced diploma) completions between 2009 and

2020.

For the downstream process manufacturing industries, the growing impact of technology is clear, in

particular for the more specialist industries such as composites manufacturing or polymer product

manufacturing. This has also been highlighted in the MSA 2014 and 2015 environmental scans

and also the MSA Symposium Stimulus – Manufacturing in 2030 the new horizon document. The

outcomes of the RITC automation project identified the impact of automation on skills which in turn

will impact these industry sectors, emerging and niche areas and advanced manufacturing in

general.

There is also a growing need for evidence of competency across RITC industries, especially for

downstream industries that service the upstream resources sector. For example, organisations

manufacturing refractory bricks or monolithic refractory facilities have to provide evidence to the

project owner that their skilled workers have the required competencies to undertake this specialist

work. As such, informal training on the job is now not sufficient and companies are turning to

nationally recognized training to fill the void. In many cases, such occupations are deemed as thin

markets making it difficult to attract RTO interest. This is particularly the case when learning

materials need development and where teaching expertise is not of sufficient depth.

This situation becomes more difficult in terms of on the job training. For some enterprises, “on the

job” would in reality be on the client’s project, and sub-contractors have raised concerns about the

potential impact on tender contracts if some of the skilled workers would be in training at the time

of the project.

3.7.1 VET Training Data by Qualification

Although the process manufacturing and laboratory operations sectors in Western Australia have

been making long-term investments in the skilling of their workforces, changes to government

funding may add to skill shortages in the near future, heightened by the number of older workers

retiring from the industry. The recent constriction of the existing worker trainee list for subsidized

qualifications in laboratory operations and the removal of funding for VET Fee Help for Certificate

IV are yet to determine how these changes will affect this cohort of workers and future skills.

The graphs below, however, point to varied growth patterns. NCVER data illustrates a consistent

decrease in the level of engagement with VET enterprises in laboratory operations since 2012, a

converse growth in VETiS enrolments in chemical, hydrocarbons and oil refining which has more

than tripled in the last 3 years and manufacturing which has increased by 46 per cent64.

It is critical the value of VET in the workplace is promoted to advocate career options into the

industries and to stimulate growth. Although 68 per cent of former apprentices and trainees

remained with their employer after their training had finished65, attempts to deepen employee-

employer engagement and build workforce capacity should be encouraged. Engaging the next

generation to take up manufacturing careers66, increasing computer and STEM proficiency across

64

NCVER VOCSTATS, December 2014 65

NCVER, Apprentice and Trainees Destinations Survey, 2010 66


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all education providers and collaboration with VET stakeholders, deepening knowledge, up-skilling

and cross-skilling workers will help shape a sustainable future and an innovative and globally

competitive industry.

An area where the RITC could add the most value is assisting smaller companies in these sectors,

which form the majority of the market67, to make the most of available funding and training

opportunities.

3.7.2 Pre-Employment

In order to outline pre-employment trends in the downstream process manufacturing industry,

additional analysis of certain institutionally-based training (IBT)68 has been undertaken, specifically

for the MSL09, MSA07, PMA08 and PMB07 training packages.

Pre-employment training programs are often designed as short institutional courses for new

entrants to the sector to give students an insight into the industry and equip them with the basic

underlying skills required to perform entry level work.

MSA has designed two Certificate I programs that are particularly tailored to the entry level worker:

MSA10107 Certificate I in Manufacturing (Pathways) should provide the student with a set

of competencies that collectively open up pathways into employment and/or further study69

MSA10207 Certificate I in Process Manufacturing – intended for entry to the industry and

addresses job outcomes at this level. It has been developed as a common certificate for

use across the three process manufacturing sectors (covered in PMA09, PMB07, PMC10

training packages)70

MSA’s Certificate II in Process Manufacturing (MSA20107) has also been designed to cross over

the three main process manufacturing training packages and is suitable as an entry level

qualification.

The recent commonwealth review of training packages and accredited courses encouraged the

pursuit of higher level qualifications. It is anticipated the withdrawal of government employment

incentives and funding will increase attainment of higher level certificates and diplomas. As seen in

the graphs below students have not been attracted to higher qualifications, with the exception of

MSL and PMA which show a decreasing up-take of these in the last few years.

For the laboratory operations sector, the Certificate II in Sampling and Measurement (MSL20109)

is accepted as a pathway qualification, leading either to employment or further study. This

qualification has been designed to offer entry level training for sampling and measurement skills

applied across a range of industries with various occupational outcomes, ranging from samplers

and testers, to production operators, to field assistants71.

Currently, the Chamber of Commerce and Industry (CCI) is developing a new Class B

apprenticeship pathway to supplement the existing PMA traineeship qualification in process plant

operations to provide opportunities for school leavers without prior industry experience to enter the

oil and gas industry. This qualification is equally relevant to the downstream process manufacturing

sector.

67

ABS, Counts of Australian Business 2009 68

National Centre for Vocational Education Research (NCVER), VOCSTATS DataCube, Apprentice and Trainee Data,

October to December 2014 69

http://training.gov.au/TrainingComponentFiles/MSA07/MSA07_R8.1.pdf 70

http://training.gov.au/TrainingComponentFiles/MSA07/MSA07_R8.1.pdf 71

http://training.gov.au/TrainingComponentFiles/MSA07/MSA07_R8.1.pdf




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The charts below indicate the delivery of various RITC training packages in an institutional context,

indicating the proportion of Certificate I and II level programs which are often utilized as pre-

employment programs.

For the MSA07 Certificate I and particularly PMA08 Certificate II programs the charts below

indicate a strong and growing take up by students in Western Australia. The enrolments for the

MSL09 programs have declined since 2011 across all enrolments, with Certificate II attracting

around 40 students compared to an excess of 100 enrolments in 2011.

It is expected that changes to requirements in Western Australia for attainment of the Western

Australian Certificate of Education (WACE) will stimulate demand for process manufacturing

qualifications at the lower qualification levels. Providing students with choice for tertiary and

vocational studies in turn presents schools with opportunities to fully utilize their resources which

should result in a growing number of Certificate II qualifications being undertaken by students in

the coming years, continuing the trend in replacing Certificate I qualifications.

As outlined in the 2015 scan, manufacturing and VET must work together to ensure industry needs

are met with a capable highly skilled workforce to create competitive, higher value operations

capable of thriving in high cost environments72.

Figure 6: RITC IBT VET Enrolments for MSA Training Package Source: Department of Training and Workforce Development, June 2015

72


0

10

20

30

40

50

60

70

2010 2011 2012 2013 2014

RITC VET Enrolments for MSA Training Package

411 Advanced Diploma

421 Diploma

511 Certificate IV

514 Certificate III

524 Certificate I

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Figure 7: RITC IBT VET Enrolments for PMA Training Package

Source: Department of Training and Workforce Development, June 2015

Figure 8: RITC IBT VET Enrolments for PMB Training Package

Source: Department of Training and Workforce Development; June 2015

0

50

100

150

200

250

300

350

400

2010 2011 2012 2013 2014

RITC VET IBT Enrolments for PMA Training Package


421 Diploma

511 Certificate IV

514 Certificate III

521 Certificate II

0

1

2

3

4

5

6

7

8

9

2010 2011 2012 2013

RITC VET IBT Enrolments for PMB Training Package

514 Certificate III

521 Certificate II

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Figure 9: RITC IBT VET Enrolments for PML Training Package

Source: Department of Training and Workforce Development; June 2015

Figure 10: RITC IBT VET Enrolments for MSL Training Package Source: Department of Training and Workforce Development, June 2015

3.7.3 Apprenticeships and Traineeships

Companies surveyed for the 2015 MSA Environmental Scan report that although there is a strong

commitment to apprenticeships, current take up numbers are not meeting industry need across

manufacturing sectors73 with industry flagging skill shortages into the future, particularly given the

ageing industry workforce. There is also a concern apprentice skill levels are not meeting the

needs of advanced manufacturing.

73


0

50

100

150

200

250

300

350

2010 2011 2012

RITC VET IBT Enrolments for PML Package


421 Diploma

511 Certificate IV

514 Certificate III

521 Certificate II

0

50

100

150

200

250

300

350

2010 2011 2012 2013 2014

RITC VET IBT Enrolments for MSL Package


421 Diploma

511 Certificate IV

514 Certificate III

521 Certificate II

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Training data for apprentices and trainees has been analyzed for the downstream process

manufacturing industries of Western Australia through NCVER74.

This analysis was undertaken for all industry subdivisions identified as part of downstream process

manufacturing to allow easy comparison with ABS Census labour force data.

Figure 11 below highlights the growth in the numbers of apprentices and trainees in these

downstream sectors. As at December 2014 there was little change in the number of apprentices

and trainees in this industry area compared with the same period in 2013, remaining significant

(around 1,600 in each year).

Figure 11: Apprentices and Trainees in Training in Western Australia, Employed in the

Downstream Process Manufacturing Industry (ANZIC 17, 18, 19, 20, 21, 6910 and 6925)

Source: NCVER VOCSTATS; December 2014

Figure 12 overleaf is a pictorial representation of those industry subdivisions employing

apprentices or trainees, and their relative share. As at December 2014, the principal employers of

apprentices and trainees within downstream process manufacturing are:

Scientific testing and analysis sciences

Alumina production

Clay brick manufacturing

Glass and glass product manufacturing

Rigid and semi-rigid polymer product manufacturing

74

NCVER, VOCSTATS, December 2014

-

200

400

600

800

1,000

1,200

1,400

1,600

1,800

Oct - Dec2009

Oct - Dec2010

Oct - Dec2011

Oct - Dec2012

Oct - Dec2013

Oct - Dec2014

Apprentices and Trainees in Downstream Process Manufacturing WA

Total

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Figure 12: Western Australian Downstream Industries Employing Apprentices and Trainees

in Q4 2014 Source: NCVER VOCSTATS, December 2014

As the chart below (Figure 13) indicates, the majority of apprentices and trainees are still employed

within the technicians and trades workers ANZSCO group, as would be expected.

1% 0% 7%

8%

8%

4%

2%

4%

5%

14%

45%

1%

Distribution of Apprentices and Trainees in Downstream Process Manufacturing - Q4

2014

1709 - Other Petroleum and CoalProduct Manufacturing

1841 - Human Pharmaceuticaland Medicinal ProductManufacturing

1912 - Rigid and Semi-RigidPolymer Product Manufacturing

2010 - Glass and Glass ProductManufacturing

2021 - Clay Brick Manufacturing

2034 - Concrete ProductManufacturing

2090 - Other Non-MetallicMineral Product Manufacturing

2110 - Basic Ferrous MetalManufacturing

2122 - Steel Pipe and TubeManufacturing

2131 - Alumina Production

6925 - Scientific Testing andAnalysis Services

6910 - Scientific ResearchServices

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Figure 13: Occupational Breakdown for Apprentices and Trainees in Downstream Process

Manufacturing Source: NCVER VOCSTATS, December 2014

3.7.4 VETiS

The RITC promotes different VET in Schools (VETiS) initiatives. However, as the following Figure

14 outlines, VETiS programs currently only form a very small proportion of all institutionally-based

training. The RITC believes there is scope for a greater engagement between schools and sections

of the process manufacturing industries, particularly in light of recent WACE changes with students

given higher education and vocational study options. It is important this group is encouraged to

explore opportunities within the downstream process manufacturing sector to improve student up-

take and mitigate the continued to fall in enrolments.

2% 0%

81%

0%

9%

0% 2% 5%

Occupational Breakdown for Apprentices and Trainees in Downstream Process

Manufacturing - Q1 2014

1 Managers

2 Professionals

3 Technicians and TradesWorkers

4 Community and PersonalService Workers

5 Clerical and AdministrativeWorkers

6 Sales Workers

7 Machinery Operators andDrivers

8 Labourers

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Figure 14: RITC IBT Course Enrolments (MSA, MSL, PMA, PMB, PMC, PML)

Source: Department of Training and Workforce Development; VESU; June 2015

Figure 15 illustrates the distribution of VETiS by qualification level across the training package

coverage. The laboratory operations training package is still most dominant, followed by chemical,

hydrocarbons and oil refining, up from 2013, and manufacturing close to doubling since the same

time last year. The growing interest in the PMA training package is not surprising given the growth

in activity in the oil and gas sector.

Figure 15: RITC Course Enrolments VET in Schools by Training Package

(MSA, MSL, PMA, PMB, PMC, PML) Source: Department of Training and Workforce Development; June 2015

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2010 2011 2012 2013 2014

RITC IBT Course Enrolments (MSA, MSL, PMA, PMB, PMC, PML)

VET in Schools

Non VET in Schools

0

10

20

30

40

50

60

70

80

90

2010 2011 2012 2013 2014

RITC Course Enrolments for VET in Schools by Training Package

MSA Manufacturing TrainingPackage

MSL Laboratory Operations

PMA Chemical, Hydrocarbonsand Oil Refining

PMB Plastics, Rubber andCablemaking

PMC Manufactured MineralProducts

PML Laboratory Operations

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3.7.5 Higher Education Pathways

In the area of higher education, process manufacturing and laboratory operations offer an

interesting comparison.

There is a stark comparison in the take-up of tertiary study between the two divisions, with around

17 per cent of people employed in manufacturing holding a tertiary qualification or above compared

to around 56 per cent of people employed in professional services75.

Commonwealth agenda and changes to policy are the agents of change which will lift higher

education enrolments. With greater advocacy for students to complete science, technology,

engineering and mathematics (STEM) subjects in schools, this will increase the capacity and

capability of students to explore pathways into higher education courses to provide industries with

a skilled workforce for the future and grow Australia’s innovation and competitiveness in a global

marketplace.

3.8 Downstream Process Manufacturing Industry Issues

3.8.1 Technology and Advanced Manufacturing

Advanced manufacturing is a product of a new industrial age. Manufacturing is moving away from

traditional manufacturing business models and becoming more sophisticated, high-tech and

globally minded. The sector is adapting to advances in technology and automation, global

connectivity through computation and a new unprecedented pace of change. For manufacturing to

be sustainable it needs to be globally competitive and work collaboratively to permeate globalized

supply chains particularly in emerging economies targeting niche and high end products.

3.8.2 Skill Development

This shift towards technology is growing industry sophistication and making the sector

progressively more reliant on higher skills. As lower skill roles become impacted by emerging and

evolving technology and increasingly obsolete, new ones emerge requiring higher skills, critical

thinking, problem solving and digital literacy. To gain a competitive advantage and respond to the

challenges of a technical environment, manufacturing needs a flexible and skilled workforce,

integrating leadership and management skills and high level STEM capability and application to

drive innovation, productivity and efficiency gains. As such, greater attention needs to be focused

on the strengthening and development of science, technology, engineering and mathematics

capability.

3.8.3 Training

A flexible, responsive and innovative VET sector to train and up-skill local manufacturing sector

workforce is essential to ensure future industry and economic growth. For the workforce to respond

to the challenges of a more complex environment and a growing demand for higher skills, training

packages, the vocational training provision and delivery of training must be flexible, timely, fit for

purpose, relevant for employers and led by industry needs particularly where niche and thin

markets are concerned. Greater engagement of STEM skills and their application is critical across

education sectors, including VET qualifications.

75

ABS Education and Work 2011

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3.8.4 Government Policy and Research and Development Outcomes

It is crucial for Australia to have a regulatory environment which supports areas of competitive

strength, addresses cost pressures, drives skill capacity and supports businesses to expand scope

and access markets. The Australian Government recognizes the importance of advanced

manufacturing as one of the top five priority growth areas and is developing initiatives to improve

manufacturing’s global market position. Under the Industry Innovation and Competitiveness

Agenda, already work is being done to grow mining equipment, technology and services (METS)

and improving collaboration between industry, science and research to ensure Australia is part of

global supply chains.

Further work needs to be done to strengthen research and development opportunities and

outcomes for businesses through increased incentives to innovate, and collaboration between

industry stakeholders and universities. As pointed out in the 2015 Environmental Scan,

government leadership is fundamental to building and attracting local investment and commitment

and expanding manufacturing on a global stage.

The development of the advanced manufacturing growth centre should address issues around

business support and research and development outcomes.

3.8.5 Ageing Workforce

There is an ageing workforce in the downstream process manufacturing industry in Western

Australia. To mitigate the long term risks of skills shortages, attrition and workforce impact and for

the industry and the nation to prosper long term, we need to encourage broader and more diverse

workforce participation and ensure appropriate transfer of knowledge to less experienced staff

through training and mentoring.

3.8.6 Youth

For this sector, ensuring the industry is on the radar of young people making career decisions is

fundamental for the sustainability of this sector in the coming years. With changes to the education

system in Western Australia placing a greater focus on vocational pathways in school, it is timely to

review strategies and mechanisms to determine how more can be done in this area.

3.8.7 Gender Diversity

In recent years there has been low female participation in the Western Australian downstream

process manufacturing workforce. Attracting and retaining more women in the industry is a means

of addressing skills challenges. Australian governments recognise the social and economic

benefits of increasing female workforce participation and including them in the future skills pipeline

with a focus on initiatives to increase the number of girls undertaking STEM subjects at school and

promote and improve rates of women into engineering. The Filling the Pool Report provides many

recommendations to addresses this further76.

3.8.8 Indigenous Australians

It is important we increase the representation of Indigenous Australians in the sector and equip

them with the skills and capabilities to thrive in an environment characterised by innovative

technologies. Fundamental to a greater participation of Indigenous Australians in employment is

the need to improve educational attainment of Indigenous people and this will need further reform

and collaborations of all stakeholders to assist effective future outcomes.

76

Committee for Perth, Filling the Pool Report, June 2015



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3.8.9 Relevance of ANZSCO for Skilled Occupation Lists

Use of the ANZSCO system of classification does not accurately reflect innovative and emerging

occupations across RITC industries, especially within process manufacturing and laboratory

operations.

3.8.10 VET in Schools

To ensure that the downstream process manufacturing industries can continue to train and develop

a sustainable workforce in the future, ensuring access to a high quality, flexible VET in Schools

program that meets industry’s needs is important.

3.8.11 Language, Literacy and Numeracy Skills

Low levels of LLN skills in the downstream manufacturing workforce are also an issue that has

been raised with the RITC. To ensure that workforce safety is not compromised and to address

productivity issues, addressing LLN skills should be a priority.

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SECTION 4 INDUSTRY ISSUES AND STRATEGIES

Skilling WA: Strategic Goal 1

Increase participation in the workforce particularly among the under-employed and disengaged, mature-aged workers, Aboriginal and Torres

Strait Islander and other under-represented groups.

Issue (from Section 3) Strategy Skilling WA

Priority Action

Greater Female Workforce Participation

The RITC process manufacturing industries show a

wide variance in the participation of women in the

workforce. With 2011 census data showing women

comprise only 21.19 per cent of the process

manufacturing workforce, there is potential to develop

strategies to improve the representation of women

across the process manufacturing industries.

Continue to champion greater female workforce participation

in the downstream process manufacturing industry through

independent consultation and communications channels.

Investigate the potential of a pilot project in the downstream

process manufacturing industry to promote greater

workforce diversity and increased workforce participation for

women and Aboriginal Australians in these smaller specialist

enterprises.

Undertake a more in-depth analysis of the representation of

women across the process manufacturing industries.

1.1.1 – Industry

leadership in

workforce

participation

1.2.6 – Workforce

participation of

under-represented

groups

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Attract workers with the right skills to the Western Australian workforce and retain them by offering access to rewarding employment and a

diverse and vibrant community and environment to live in.

Issue (from Section 3) Strategy Skilling WA Priority

Action

Ageing Workforce

Process manufacturing industries in Western

Australia generally have an older age workforce

profile making them susceptible to a loss of skills and

knowledge when this component of the workforce

leaves.

Develop information identifying different funding

opportunities and strategies to assist employers with

this workforce challenge and ensure that employers

can plan for this change, and develop strategies that

will allow them to remain attached to the industry in a

training and/or mentoring role to prevent loss of

operational knowledge and experience from the

industry as recommended in the RITC

Apprenticeships report.

3.1.1 – Industry leadership

in attraction and retention

Accessing and Retaining a Skilled Labour Force

The Western Australian RITC industries continue to

experience challenges in accessing and retaining the

appropriately skilled labour required in a timely and

cost-effective manner.

Continue to promote careers in the RITC industries to

young people and more mature people.

Work with industry partners to identify retention tools

such as training, work culture and employee

engagement initiatives to improve industry retention

rates and to undertake desktop research on retention

strategies in practice that can be promoted through

the RITC website and newsletters to industry.


in attraction and retention

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Provide flexible, responsive and innovative education and training which enables people to develop and utilize the skills necessary for them to

realize their potential and contribute to Western Australia’s prosperity.

Issue (from Section 3) Strategy Skilling WA Priority

Action

Quality and Flexibility of Delivery

A flexible, responsive and innovative VET sector is

essential to train and up-skill the local resources

sector workforce with the skills required. In the

coming years the sector’s skill requirements will

adapt following the adoption of greater automation

technology. In a more contestable training market, a

danger exists that providers will not service thin

market areas resulting in parts of industry not having

access to publicly supported vocational education

and training places.

Continue to broker greater industry involvement in

training package development and training delivery.


in training

Lack of STEM Focus

A significant number of technical and professional

occupations within the contemporary process

manufacturing sector require individuals that have

well-developed science, technology, engineering and

mathematics (STEM) skills.

Promote science, technology, engineering and

mathematics (STEM) pathways to ensure that VET

and HE initiatives reflect the expertise in demand by

the Western Australian resources sector.


in training

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Language, Literacy and Numeracy (LLN)

Low levels of LLN skills in the downstream

manufacturing workforce are also an issue that has

been raised with the RITC. To ensure that workforce

safety is not compromised and to address

productivity issues, addressing LLN skills should be

a priority.

Continue to promote training in LLN skills to ensure

that the Western Australian process manufacturing

workforce is able to meet industry demand.

The proposed workforce development project

targeting the process manufacturing industries will

seek to gather intelligence on the scope of LLN

issues.


in training

VET in Schools

To ensure that the downstream process

manufacturing industries can continue to train and

develop a sustainable workforce in the future,

ensuring access to a high quality, flexible VET in

Schools program that meets industry’s needs is

important.

Explore opportunities for VETiS programs that

address process manufacturing industry needs

leveraging the previous RITC process manufacturing

project outcomes. This will include engagement with

school VET coordinators, industry, individual schools

and school associations.


in training

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SECTION 5 RECOMMENDED PRIORITY ACTION PLAN

Skilling WA Strategic Goal 3: Accessing and retaining a skilled labour force.

Strategy from Section 4: Explore opportunities for VETiS programs that address process manufacturing industry needs leveraging the previous RITC

process manufacturing project outcomes. This will include engagement with school VET co-ordinators, industry, individual schools and school

associations.

Recommended Priority Action(s) Steps to Implement Actions Priority Date to be

completed

Undertake a detailed analysis of VETiS delivery in the process

manufacturing industries and also gauge potential for industry

engagement in VETiS programs. Working with schools in target

areas (identified from those in close proximity to process

manufacturing industry enterprises prepared to be engaged with

VETiS), examine appropriate delivery models for implementation.

This work will be informed by the experiences of the Kwinana

Industries Council in engaging with process manufacturing

industries based in the Kwinana Heavy Industrial Area and also

schools located in the Kwinana community and surrounds.

Gather and analyse detailed system data

across process manufacturing training

packages relating to VETiS.

Consult with KIC and Kwinana community

schools to identify critical success factors

for relevant KIC programs.

Consult with industry to determine sector

and enterprises prepared to engage with

VETiS programs as a means of addressing

workforce development issues.

Identify target schools and engage with

VET coordinators to determine potential for

partnership to be developed.

Explore delivery issues (RTOs,

infrastructure requirements, learning

resources, etc) including VETiS register to

determine appropriate delivery models.

Develop implementation plan for a pilot

program involving industry, schools and

RTOs within funding constraints and

Medium-High 2015/16

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execute plan.

Undertake evaluation.

Lead Agency: RITC

Skilling WA Strategic Goal 4:

Strategy from Section 4: Continue to broker greater industry involvement in training package development and training delivery.

Recommended Priority Action(s) Steps to Implement Actions Priority Date to be

completed

Training packages are a reflection of industry skill need

expressed in units of competence, skill sets and qualifications.

For training packages to remain relevant, industry must remain

engaged in the development and review process.

Work with MSA (and its successor Skills

Service Organisation from 1 January 2016)

to promote stakeholder feedback

mechanisms and encourage industry

representatives to play a role in training

package development.

Provide forums for industry and RTO

representatives to highlight industry

changes and opportunities and discuss any

changes in the industry or VET

environment.

Participate in various industry and training

advisory networks to promote best practice

in training and workforce development.

Support national strategies to address

issues around quality training delivery.

High

September 2016

Lead Agency: RITC

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SECTION 6 PLAN ADMINISTRATION

Plan Contact

This plan is maintained by the Manager for the Resources Industry Training Council. Feedback

regarding this plan should be made in writing to:

a Email: [email protected]

b Mail: RITC, Locked Bag N984, Perth, WA 6844

c Fax: (08) 9221 3701

d Office phone number: (08) 9220 8538

Review Requirements and Issue History

Schedule 2 of the Service Agreement requires that this plan is reviewed and updated annually.

This issue entirely supersedes the previous issue of the plan. Superseded issues should be

destroyed, or clearly marked as superseded and removed from general circulation and the Training

Council website.

Issue No. Year Approved Comments/Summary of Main Changes

2 2014 Updated ABS data, training data, industry intelligence, strategies

and priority actions.

3 2015 Updated ABS data, training data, industry intelligence, strategies

and priority actions.

Distribution List

This plan is issued electronically on the Training Council website after it is approved. Print/paper

copies are provided as follows (if applicable).

This IWDP will be issued electronically via the RITC website, www.ritcwa.com.au. It will also be

forwarded through to the RITC Advisory Board.

Consultation for this Issue

The review of this issue of this plan was coordinated by the Manager for the Resources Industry

Training Council. This issue was updated/re-written as part of the annual review process and the

main round of consultation with industry representatives and the Resources Industry Training

Council Advisory Board occurred throughout 2014.

Over this period the committee invited comment from a range of stakeholders, at broad forums

such as the RITC/SkillsDMC Network meetings, as well as independent industry consultation.

Communications Plan Summary

Once the plan is approved, its update will be:

a endorsed by the Resources Industry Training Council Advisory Board

b noted by the Department of Training and Workforce Development

c posted on the Resources Industry Training Council website and promoted through

social media.

http://www.ritcwa.com.au/

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Validation of this Plan

Arrangements in this plan will be validated within the annual review cycle through consultation with

the Resources Industry Training Council Advisory Board at the quarterly meetings.

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SECTION 7 LIST OF TABLES

This section should be used to provide a list of tables and graphs used within the main body of the

document.

Number Name of Table or Graph

Table 1: Western Australian Downstream Process Manufacturing Industry Workforce by

Occupation - Comparison of Downstream Process Manufacturing Industry Sub-divisions; Source:

2011 Census of Population and Housing. ..................................................................................... 25

Figure 1: Australia’s Plastics and Chemicals Industry; Source: PACIA, Adding Value – The critical,

enabling role of the chemicals and plastics industry for Australia’s future, July 2014. ................... 17

Figure 2: Western Australian Downstream Process Manufacturing Workforce by Occupation

(ANZSCO 1 digit); Source: 2011 Census of Population and Housing. ........................................... 24

Figure 3: Western Australian Downstream Process Manufacturing Workforce Age Profile; Source:

2011 ABS Census of Population and Housing. ............................................................................. 29

Figure 4: Western Australian Downstream Process Manufacturing Workforce Age Profile; Source:

2011 Census of Population and Housing. ..................................................................................... 30

Figure 5: Key school education factors limiting the development of a STEM capable workforce;

Source: TIAC, Optimising STEM Education in WA Schools, February 2014, p10 ......................... 33

Figure 6: RITC IBT VET Enrolments for MSA Training Package; Source: Department of Training

and Workforce Development, June 2015.. .................................................................................... 44

Figure 7: RITC IBT VET Enrolments for PMA Training Package; Source: Department of Training

and Workforce Development, June 2015.. .................................................................................... 45

Figure 8: RITC IBT VET Enrolments for PMB Training Package; Source: Department of Training

and Workforce Development; June 2015. ..................................................................................... 45

Figure 9: RITC IBT VET Enrolments for PML Training Package; Source: Department of Training

and Workforce Development; June 2015.. .................................................................................... 46

Figure 10: RITC IBT VET Enrolments for MSL Training Package; Source: Department of Training

and Workforce Development; June 2015.. .................................................................................... 46

Figure 11: Apprentices and Trainees in Training in Western Australia, Employed in the

Downstream Process Manufacturing Industry (ANZIC 17, 18, 19, 20, 21, 6910 and 6925); Source:

NCVER VOCSTATS; December 2014.. ........................................................................................ 47

Figure 12: Western Australian Downstream Industries Employing Apprentices and Trainees in Q4

2014; Source: NCVER VOCSTATS; December 2014.. ................................................................. 48

Figure 13: Occupational Breakdown for Apprentices and Trainees in Downstream Process

Manufacturing; Source: NCVER VOCSTATS – December 2014. .................................................. 49

Figure 14: RITC IBT Course Enrolments(MSA, MSL, PMA, PMB, PMC, PML); Source: Department

of Training and Workforce Development; VESU; June 2015. ........................................................ 50

Figure 15: RITC Course Enrolments VET in Schools by Training Package (MSA, MSL, PMA, PMB,

PMC, PML); Source: Department of Training and Workforce Development; June 2015. ............... 50

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SECTION 8 GLOSSARY

The following terms that are used in this plan are particular to this Training Council.

Acronyms

Please note that all terms are written in full before acronyms are used.

ABS Australian Bureau of Statistics

ACEPT Australian Centre for Energy and Process Training

ADIA Australian Drilling Industry Association

AIP Australian Industry Participation

ANZSCO Australian New Zealand Standard Classification of Occupations

ANZSIC Australian New Zealand Standard Industry Classification

APLAC Asia Pacific Laboratory Accreditation Cooperation

APPEA Australian Petroleum Production and Exploration Association

AQF Australian Qualifications Framework

ASQA Australian Skills Quality Authority

AWDC Aboriginal Workforce Development Centre

AWPA Australian Workforce and Productivity Agency

AWRA Australian Women in Resources Alliance

BREE Bureau of Resources and Energy Economics

CME Chamber of Minerals and Energy of Western Australia

CMT Construction Materials Testing

COAG Council of Australian Governments

CPM Carbon Pricing Mechanism

DEEWR Department of Education, Employment and Workplace Relations

DIAC Department of Immigration and Citizenship

DIDO Drive-In Drive-Out

DIISRTE Department of Industry, Innovation, Science, Research and Tertiary Education

DMP Department of Mines and Petroleum

DSD Department of State Development

DTWD Department of Training and Workforce Development

EAG Energy Apprenticeships Group

EATC Engineering Automotive Training Council

EBT Employment-based training

EIS Exploration Incentive Scheme

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EMAs Enterprise Migration Agreements

ENS Employer Nomination Stream

EOWA Equal Opportunity for Women in the Workplace Agency

EUPA Electrical, Utilities and Public Administration Training Council

FID Final Investment Decision

FIFO Fly-in Fly-out

FLNG Floating Liquefied Natural Gas (facility)

GSP Gross State Product

HE Higher Education

IBT Institutionally-based training

ICNL Industry Capability Network Limited

ILAC International Laboratory Accreditation Cooperation

ILP Indigenous Leadership Program

IWDP Industry Workforce Development Plan

LAs Labour Agreements

LNG Liquefied Natural Gas

MCA Minerals Council of Australia

MEA Mining Education Australia

MEP Metallurgical Education Partnership

MGH Minerals Geoscience Honors

MGM Minerals Geoscience Masters

MINAD Minerals Industry National Associate Degree Program

MRRT Minerals Resource Rent Tax

MSA Manufacturing Skills Australia

MTEC Mining Tertiary Education Council

NATA National Association of Testing Authorities

NCVER National Centre for Vocational Education and Research

Nfd not further defined

NICNAS National Industrial Chemicals Notification and Assessment Scheme

NOLA National Occupational Licensing Authority

NOLS National Occupational Licensing System

NOM Net Overseas Migration

NRSET National Resources Sector Employment Taskforce

NSSC National Skills Standards Council

NWS North West Shelf

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OEM Original Equipment Manufacturer

OS&H Occupational Safety and Health

PACIA Plastics and Chemicals Industries Association

PwC Pricewaterhouse Coopers

RAP Reconciliation Action Plan

RITC Resources Industry Training Council

RMAs Regional Migration Agreements

RSMS Regional Skilled Migration Scheme

RSPT Resource Super Profits Tax

RTO Registered Training Organisation

SAMP Supplier Access to Major Projects

SIA Safety Institute of Australia

SIA Strategic Industry Audit

SPOL State Priority Occupation List

STP State Training Provider

TAC Training Accreditation Council

VET Vocational Education and Training

VETIS VET in Schools

VOC Verification of Competency

WASMOL Western Australian Skilled Migration Occupation List

WIMWA Women in Mining Western Australia

WIP Work Innovation Program

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SECTION 9 APPENDIX

Appendix 1: Key RITC Industry Areas – Projected Economic and Activity Conditions

(Australia) Source: IBISWorld, June 2015

ANZSIC Code

Industry Revenue 13/14 ($bn)

Annual Growth (09 - 14)


Businesses (#)

Activity in WA

WA Revenue*

($bn)

WA Businesses*

(#)

B0601 Black Coal Mining

41.0 -4.0% 2.9% 377 5.10% 2.1 19

B0700 Oil and Gas Extraction

41.1 5.8% 15.1% 24 70.00% 28.8 17

B0801 Iron Ore Mining 63.1 7.2% 5.4% 39 97.60% 61.6 38

B0802 Bauxite Mining 2.2 11.7% 2.1% 4 57.90% 1.3 2

B0803 Copper Ore Mining

6.6 1.2% 1.3% 69 18.90% 1.2 13

B0804 Gold Ore Mining 12.3 3.4% 1.4% 623 69.80% 8.6 435

B0805 Mineral Sand Mining

2.5 5.9% 3.4% 143 43.90% 1.1 63

B0806 Nickel Ore Mining

3.7 -3.8% 3.7% 34 71.80% 2.7 24

B0807 Silver-Lead-Zinc Ore Mining

5.0 2.0% 1.8% 39 8.20% 0.4 3

B0809

Manganese and Other Metal Ore Mining

2.6 -0.8% 1.4% 137 55.40% 1.4 76

B0911 Gravel and Sand Quarrying

0.7 0.7% 2.2% 405 7.30% 0.0 30

B0919 Rock, Limestone and Clay Mining

3.5 1.9% 2.1% 785 13.10% 0.5 103

B0991

Diamond and Gemstone Mining

0.5 -9.4% 5.7% 63 87.60% 0.5 55

B0992 Salt and Other Mineral Mining

0.9 -0.7% 2.4% 165 50.90% 0.5 84

B1011 Petroleum Exploration

2.5 -8.0% -0.5% 428 62.40% 1.6 267

B1012 Mineral Exploration

1.8 -6.2% 0.5% 1,242 57.10% 1.0 709

B1090

Other Mining Support Services

6.6 -8.0% 3.0% 1,427 38.00% 2.5 542

C1701

Petroleum Refining and Petroleum Fuel Manufacturing

15.0 -8.3% -3.8% 119 25.60% 3.8 30

C1709

Lubricants and Other Petroleum Product Manufacturing

1.7 -2.2% -2.2% 151 16.80% 0.3 25

C1811 Industrial Gas Manufacturing

4.0 1.3% 2.2% 43 30.10% 1.2 13

C1812

Basic Organic Chemical Manufacturing

1.9 6.7% 1.2% 115 11.50% 0.2 13

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ANZSIC Code




Businesses (#)

Activity in WA

WA Revenue*

($bn)

WA Businesses*

(#)

C1813

Basic Inorganic Chemical Manufacturing

2.5 -4.8% 1.1% 75 18.50% 0.5 14

C1821

Synthetic Resin and Rubber Manufacturing

2.8 -1.9% -0.4% 56 7.10% 0.2 4

C1831 Fertiliser Manufacturing

3.6 -1.5% 0.9% 285 15.90% 0.6 45

C1832 Pesticide Manufacturing

1.0 -1.5% 0.6% 89 19.60% 0.2 17

C1841

Pharmaceutical Product Manufacturing

9.2 -2.7% 1.9% 292 6.50% 0.6 19

C1851

Soap and Cleaning Compound Manufacturing

1.6 -10.0% 0.2% 390 8.10% 0.1 32

C1852

Cosmetics, Perfume and Toiletries Manufacturing

1.0 0.6% 1.8% 490 7.30% 0.1 36

C1892 Explosive Manufacturing

3.6 10.2% 3.7% 51 24.50% 0.9 12

C1911

Plastic Bag and Film Manufacturing

2.1 -5.0% -1.3% 275 3.90% 0.1 11

C1912a

Plastic Blow Moulded Product Manufacturing

1.5 0.4% 1.1% 137 10.80% 0.2 15

C1912b

Plastic Injection Molded Product Manufacturing

2.8 -4.3% -1.5% 900 12.00% 0.3 108

C1913

Plastic Foam Product Manufacturing

0.6 -6.1% -2.3% 136 9.90% 0.1 13

C1915 Adhesive Manufacturing

0.8 -2.0% 1.6% 40 11.90% 0.1 5

C1916

Paint and Coatings Manufacturing

3.0 -3.2% -2.8% 336 9.50% 0.3 32

C1919a

Plastic Extruded Product Manufacturing in Australia

1.8 -0.6% -0.8% 159 12.10% 0.2 19

C1919b

Polyester and Other Plastic Fibre Product Manufacturing

1.1 0.4% -0.7% 245 13.20% 0.1 32

C1920

Natural Rubber Product Manufacturing

0.9 0.2% -1.9% 184 8.90% 0.1 16

C2021 Clay Brick Manufacturing

0.8 -3.6% 0.9% 20 17.70% 0.1 4

C2029

Other Ceramic Product Manufacturing

0.5 -7.0% -0.4% 400 12.30% 0.1 49

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ANZSIC Code




Businesses (#)

Activity in WA

WA Revenue*

($bn)

WA Businesses*

(#)

C2031

Cement and Lime Manufacturing

2.3 -2.5% 1.3% 15 9.50% 0.2 1

C2032 Plaster Product Manufacturing

1.9 0.8% 1.9% 67 10.30% 0.2 7

C2033

Ready-Mixed Concrete Manufacturing

5.9 1.7% 0.2% 240 9.20% 0.5 22

C2034

Concrete Product Manufacturing

2.6 -1.5% 0.3% 825 14.10% 0.4 116

C2090

Glasswool, Stone and Other Non-Metallic Mineral Product Manufacturing

1.8 -3.9% 1.8% 950 13.10% 0.2 124

C2131 Alumina Production

8.0 1.9% 0.2% 9 42.90% 3.4 4

C2132 Aluminium Smelting

5.8 -5.4% -2.1% 54 3.70% 0.2 2

C2133

Copper, Silver, Lead and Zinc Smelting and Refining

3.6 -10.0% -7.5% 51 14.60% 0.5 7

C2139

Gold and Other Basic Non-Ferrous Metal Manufacturing

20.2 -1.2% 0.9% 146 61.30% 12.4 89

M6910

Scientific Research Services

4.5 -0.3% 1.6% 3,065 10.20% 0.5 313

M6925

Environmental Science Services

4.9 2.0% 2.8% 6,130 21.20% 1.0 1,300

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Appendix 2: Downstream Process Manufacturing in Western Australia Source: IBISWorld, 12 June 2015

Downstream Process Manufacturing Activity in Western Australia

2014/15; Annual Growth 10-15; Annual Growth 15-20;

ANZSIC Code

Industry Activity in WA (%)

Revenue 14/15 ($bn)



C2139 Gold and Other Basic Non-Ferrous Metal Manufacturing 61.30% 20.2 -1.2% 0.9%

C2131 Alumina Production 42.90% 8.0 1.9% 0.2%

C1811 Industrial Gas Manufacturing 30.10% 4.0 1.3% 2.2%

C1701 Petroleum Refining and Petroleum Fuel Manufacturing 25.60% 15.0 -8.3% -3.8%

C1892 Explosive Manufacturing 24.50% 3.6 10.2% 3.7%

M6925 Environmental Science Services 21.20% 4.9 2.0% 2.8%

C1832 Pesticide Manufacturing 19.60% 1.0 -1.5% 0.6%

C1813 Basic Inorganic Chemical Manufacturing 18.50% 2.5 -4.8% 1.1%

C2021 Clay Brick Manufacturing 17.70% 0.8 -3.6% 0.9%

C1709 Lubricants and Other Petroleum Product Manufacturing 16.80% 1.7 -2.2% -2.2%

C1831 Fertiliser Manufacturing 15.90% 3.6 -1.5% 0.9%

C2133 Copper, Silver, Lead and Zinc Smelting and Refining 14.60% 3.6 -10.0% -7.5%

C2034 Concrete Product Manufacturing 14.10% 2.6 -1.5% 0.3%

C1919b Polyester and Other Plastic Fibre Product Manufacturing 13.20% 1.1 0.4% -0.7%

C2090 Glasswool, Stone and Other Non-Metallic Mineral Product Manufacturing 13.10% 1.8 -3.9% 1.8%

C2029 Other Ceramic Product Manufacturing 12.30% 0.5 -7.0% -0.4%

C1919a Plastic Extruded Product Manufacturing in Australia 12.10% 1.8 -0.6% -0.8%

C1912b Plastic Injection Molded Product Manufacturing 12.00% 2.8 -4.3% -1.5%

C1915 Adhesive Manufacturing 11.90% 0.8 -2.0% 1.6%

C1812 Basic Organic Chemical Manufacturing 11.50% 1.9 6.7% 1.2%

C1912a Plastic Blow Moulded Product Manufacturing 10.80% 1.5 0.4% 1.1%

C2032 Plaster Product Manufacturing 10.30% 1.9 0.8% 1.9%

M6910 Scientific Research Services 10.20% 4.5 -0.3% 1.6%

C1913 Plastic Foam Product Manufacturing 9.90% 0.6 -6.1% -2.3%

C1916 Paint and Coatings Manufacturing 9.50% 3.0 -3.2% -2.8%

C2031 Cement and Lime Manufacturing 9.50% 2.3 -2.5% 1.3%

C2033 Ready-Mixed Concrete Manufacturing 9.20% 5.9 1.7% 0.2%

C1920 Natural Rubber Product Manufacturing 8.90% 0.9 0.2% -1.9%

C1851 Soap and Cleaning Compound Manufacturing 8.10% 1.6 -10.0% 0.2%

C1852 Cosmetics, Perfume and Toiletries Manufacturing 7.30% 1.0 0.6% 1.8%

C1821 Synthetic Resin and Rubber Manufacturing 7.10% 2.8 -1.9% -0.4%

C1841 Pharmaceutical Product Manufacturing 6.50% 9.2 -2.7% 1.9%

C1911 Plastic Bag and Film Manufacturing 3.90% 2.1 -5.0% -1.3%

C2132 Aluminium Smelting 3.70% 5.8 -5.4% -2.1%

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Appendix 3: Western Australian Downstream Process Manufacturing by Industry Area


Rank Industry Sub-division

TOTAL

Employed

% Share of

Process

Manufacturing

Employment

% Share of

total WA

employment

1 Alumina Production 5323 19.31 0.48

2 Scientific Testing and Analysis Services 3517 12.76 0.32

3 Scientific Research Services 2087 7.57 0.19

4

Other Basic Non-Ferrous Metal

Manufacturing 1773 6.43 0.16

5 Basic Inorganic Chemical Manufacturing 1175 4.26 0.11

6 Fertiliser Manufacturing 982 3.56 0.09

7

Rigid and Semi-Rigid Polymer Product


8 Clay Brick Manufacturing 908 3.29 0.08

9

Other Non-Metallic Mineral Product


10

Human Pharmaceutical and Medicinal

Product Manufacturing 811 2.94 0/07

11 Glass and Glass Product Manufacturing 723 2.62 0.07

12 Concrete Product Manufacturing 698 2.53 0.06

13

Petroleum Refining and Petroleum Fuel


14 Ready-Mixed Concrete Manufacturing 553 2.01 0.05

15 Basic Non-Ferrous Metal Manufacturing, nfd 495 1.80 0.04

16 Paint and Coatings Manufacturing 494 1.79 0.04

17 Cement and Lime Manufacturing 460 1.67 0.04

18 Explosive Manufacturing 424 1.54 0.04

19 Other Polymer Product Manufacturing 382 1.39 0.03

20

Other Basic Non-Ferrous Metal Product


21 Industrial Gas Manufacturing 360 1.31 0.03

22 Polymer Product Manufacturing, nfd 280 1.02 0.03

23

Basic Chemical and Chemical Product

Manufacturing, nfd 271 0.98 0.02

24 Polymer Foam Product Manufacturing 256 0.93 0.02

25 Cleaning Compound Manufacturing 247 0.90 0.02

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TOTAL

Employed

% Share of

Process

Manufacturing

Employment

% Share of

total WA

employment

26

Synthetic Resin and Synthetic Rubber


27

Non-Metallic Mineral Product Manufacturing,

nfd 218 0.79 0.02

28 Plaster Product Manufacturing 210 0.76 0.02

29

Other Petroleum and Coal Product


30 Aluminium Smelting 199 0.72 0.02

31 Tyre Manufacturing 192 0.70 0.02

32 Pesticide Manufacturing 173 0.63 0.02

33 Natural Rubber Product Manufacturing 161 0.58 0.01

34 Other Ceramic Product Manufacturing 159 0.58 0.01

35

Cement, Lime, Plaster and Concrete Product


36

Polymer Film and Sheet Packaging Material


37

Cosmetic and Toiletry Preparation


38

Polymer Product and Rubber Product


39

Copper, Silver, Lead and Zinc Smelting and

Refining 53 0.19 0.00

40 Basic Organic Chemical Manufacturing 41 0.15 0.00

41 Adhesive Manufacturing 38 0.14 0.00

42

Other Basic Chemical Product Manufacturing

nec 29 0.11 0.00

43 Basic Chemical Manufacturing, nfd 27 0.10 0.00

44

Basic Non-Ferrous Metal Product


45 Ceramic Product Manufacturing, nfd 20 0.07 0.00

46 Non-Ferrous Metal Casting 12 0.04 0.00

47

Veterinary Pharmaceutical and Medicinal

Product Manufacturing 11 0.04 0.00

48 Basic Polymer Manufacturing, nfd 9 0.03 0.00

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TOTAL

Employed

% Share of

Process

Manufacturing

Employment

% Share of

total WA

employment

49

Petroleum and Coal Product Manufacturing,

nfd 7 0.03 0.00

50 Other Basic Polymer Manufacturing 3 0.01 0.00

51 Fertiliser and Pesticide Manufacturing, nfd 0 0.00 0.00

52

Pharmaceutical and Medicinal Product


53

Cleaning Compound and Toiletry Preparation


54

Other Basic Chemical Product


55

Photographic Chemical Product


of 78

Appendix 4: Total Downstream Process Manufacturing by Gender


Industry Sector Male Female TOTAL

Female

Participation

Rate

Petroleum Refining

and Petroleum Fuel

Manufacturing 576 120 696 17.24%

Industrial Gas


Petroleum and Coal

Product

Manufacturing, nfd 7 0 7 0.00%

Other Petroleum and

Coal Product


Basic Chemical and

Chemical Product


Basic Chemical


Basic Organic

Chemical


Basic Inorganic

Chemical

Manufacturing 955 220 1175 18.72%

Basic Polymer


Synthetic Resin and

Synthetic Rubber


Other Basic Polymer


Fertiliser and

Pesticide


Fertiliser


Pesticide


Pharmaceutical and

Medicinal Product


of 78


Female

Participation

Rate

Human

Pharmaceutical and

Medicinal Product


Veterinary

Pharmaceutical and

Medicinal Product


Cleaning Compound

and Toiletry

Preparation


Cleaning Compound


Cosmetic and Toiletry

Preparation


Other Basic Chemical

Product


Photographic

Chemical Product


Explosive


Other Basic Chemical

Product

Manufacturing nec 20 9 29 31.03%

Polymer Product and

Rubber Product


Polymer Product


Polymer Film and

Sheet Packaging

Material


Rigid and Semi-Rigid

Polymer Product


Polymer Foam

Product


Tyre Manufacturing 173 19 192 9.90%

of 78


Female

Participation

Rate

Adhesive


Paint and Coatings


Other Polymer

Product


Natural Rubber

Product


Non-Metallic Mineral

Product


Glass and Glass

Product


Ceramic Product


Clay Brick


Other Ceramic

Product


Cement, Lime, Plaster

and Concrete Product


Cement and Lime


Plaster Product


Ready-Mixed

Concrete


Concrete Product


Other Non-Metallic

Mineral Product


Basic Non-Ferrous

Metal Manufacturing,

nfd 436 59 495 11.92%

Alumina Production 4656 667 5323 12.53%

Aluminium Smelting 167 32 199 16.08%

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Female

Participation

Rate

Copper, Silver, Lead

and Zinc Smelting and

Refining 37 16 53 30.19%

Other Basic Non-

Ferrous Metal

Manufacturing 1472 301 1773 16.98%

Basic Non-Ferrous

Metal Product


Non-Ferrous Metal

Casting 6 6 12 50.00%

Other Basic Non-

Ferrous Metal Product


Scientific Research

Services 1042 1045 2087 50.07%

Scientific Testing and

Analysis Services 2308 1209 3517 34.38%

Total 26083 7013 33096 21.19%

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Appendix 5: Comparison of Downstream Process Manufacturing Workforce with Indigenous

Participation Rates Source: 2011 ABS Census of Population and Housing

Industry Sector TOTAL

Employment

Indigenous

Participation

Rate

Petroleum Refining and Petroleum Fuel Manufacturing 696 0.86%

Industrial Gas Manufacturing 360 1.11%

Petroleum and Coal Product Manufacturing, nfd 5 0.00%

Other Petroleum and Coal Product Manufacturing 202 2.97%

Basic Chemical and Chemical Product Manufacturing, nfd 271 0.00%

Basic Chemical Manufacturing, nfd 26 0.00%

Basic Organic Chemical Manufacturing 41 0.00%

Basic Inorganic Chemical Manufacturing 1,175 0.85%

Basic Polymer Manufacturing, nfd 9 0.00%

Synthetic Resin and Synthetic Rubber Manufacturing 242 1.65%

Other Basic Polymer Manufacturing 3 0.00%

Fertiliser and Pesticide Manufacturing, nfd 0 0.00%

Fertiliser Manufacturing 977 0.00%

Pesticide Manufacturing 176 0.00%

Pharmaceutical and Medicinal Product Manufacturing, nfd 0 0.00%

Human Pharmaceutical and Medicinal Product Manufacturing 813 0.00%

Veterinary Pharmaceutical and Medicinal Product Manufacturing 12 0.00%

Cleaning Compound and Toiletry Preparation Manufacturing, nfd 4 0.00%

Cleaning Compound Manufacturing 247 1.21%

Cosmetic and Toiletry Preparation Manufacturing 67 0.00%

Other Basic Chemical Product Manufacturing, nfd 0 0.00%

Photographic Chemical Product Manufacturing 0 0.00%

Explosive Manufacturing 424 0.94%

Other Basic Chemical Product Manufacturing nec 26 0.00%

Polymer Product and Rubber Product Manufacturing, nfd 68 0.00%

Polymer Product Manufacturing, nfd 280 1.07%

Polymer Film and Sheet Packaging Material Manufacturing 128 0.00%

Rigid and Semi-Rigid Polymer Product Manufacturing 936 0.32%

Polymer Foam Product Manufacturing 253 0.00%

Tyre Manufacturing 191 1.57%

Adhesive Manufacturing 37 0.00%

Paint and Coatings Manufacturing 492 0.00%

Other Polymer Product Manufacturing 382 1.05%

Natural Rubber Product Manufacturing 160 3.13%

Non-Metallic Mineral Product Manufacturing, nfd 219 2.28%

Glass and Glass Product Manufacturing 723 1.38%

Ceramic Product Manufacturing, nfd 18 0.00%

Clay Brick Manufacturing 909 1.21%

Other Ceramic Product Manufacturing 160 0.00%

Cement, Lime, Plaster and Concrete Product Manufacturing, nfd 147 2.72%

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Industry Sector TOTAL

Employment

Indigenous

Participation

Rate

Cement and Lime Manufacturing 461 1.30%

Plaster Product Manufacturing 209 0.00%

Ready-Mixed Concrete Manufacturing 553 1.27%

Concrete Product Manufacturing 700 1.29%

Other Non-Metallic Mineral Product Manufacturing 905 1.22%

Basic Non-Ferrous Metal Manufacturing, nfd 494 1.42%

Alumina Production 5,323 0.90%

Aluminium Smelting 197 1.52%

Copper, Silver, Lead and Zinc Smelting and Refining 54 0.00%

Other Basic Non-Ferrous Metal Manufacturing 1,773 2.26%

Basic Non-Ferrous Metal Product Manufacturing, nfd 23 0.00%

Non-Ferrous Metal Casting 10 0.00%

Other Basic Non-Ferrous Metal Product Manufacturing 368 1.36%

Scientific Research Services 2,090 1.05%

Scientific Testing and Analysis Services 3,520 0.74%

Total 27,559 0.98%

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