Two-speed economy grows – PIAA
The Australian economy grew by almost one per cent in the March quarter according to national data released this week, but this growth has not been reflected in the local printing industry, which remains in an economic recession despite increased investment.
The national economic growth data released this week shows that, while the Australian economy grew by 0.9 per cent in the March quarter, the domestic printing industry declined for a third consecutive quarter, contracting by 5.3 per cent for the same period.
According to Printing Industries’ national manager for Policy and Government Affairs, Hagop Tchamkertenian (pictured), the national economic expansion rate, at 3.6 per cent annually, stands in stark contrast to the economic contraction seen in the Australian printing industry.
“It is remarkable that whilst the economy grew by 3.6 per cent compared to the same period a year ago, the printing sector contracted by 13.6 per cent over the same timeframe,” says Tchamkertenian.
However, while capital expenditure in the printing industry was reported to have declined by 13 per cent compared to the previous quarter, the industry saw a 12.9 per cent increase in investments compared to the previous period’s results. Based on these figures, it is estimated there is some $200 million of investment in the industry’s investment pipeline.
According to Tchamkertenian the ongoing disparity between the national economic growth rate and that recorded by the local printing industry indicates that there is no longer a distinct correlation between growth at the Australian economy level and at the printing industry.
He says that, while some of the national growth can be explained by the rise in significance of the resources sector, the fact that other sectors that traditionally provided positive stimulus to printing such as financial, insurance, professional services and administrative services, are failing to pull the printing sector out of its recessionary state, suggesting that the growth problems facing the printing industry are now fundamentally structural.
“The rise of alternative communication channels no doubt has eroded the market power of print and as a consequence, the traditional factors that used to influence printing industry growth have weakened,” says Tchamkertenian.
With growth remaining a challenge for many players in the printing industry, Tchamkertenian says it is critical that they concentrate on new sources of generating growth, and investing in innovation. In fact, Printing Industries is currently focusing on the necessity of innovation in the industry with a national seminar series held in conjunction with the Hargraves Institute.
“The role of innovation is increasingly becoming crucial as a driver for growth,” says Tchamkertenian. “Given the mature nature of the industry one way of continuing to remain young and vibrant is by engaging in ongoing innovation.”