A poll of Australian chief executives shows growth in the country’s manufacturing, construction and services sectors is expected to be reasonably solid, but uneven in 2010.
The result is contained in the latest CEO survey, Industry in Recovery Mode in 2010, conducted by the Australian Industry Group and Deloitte.
An improvement was expected across all three industries, with particular strength in the services and manufacturing sectors.
The survey also found improving consumer confidence in incomes growth and employment prospects, as well as rising household wealth and exposure to strong growth in China, would drive growth this year.
But the fading effects of the Federal Government’s stimulus and the impact of higher interest rates were likely to hit the construction sector particularly hard.
On average, manufacturers were anticipating a 5.6 per cent increase in the nominal value of sales in 2010 to about $415 billion.
Sales in the services sector were set to rise 6.6 per cent and construction sales were forecast to grow by 2.5 per cent.
Employment in the manufacturing industry was expected to rise 2.9 per cent, service sector employment was due to increase by 2.3 per cent, and the construction sector was set for employment growth of just 0.5 per cent.
Those employers surveyed said the possible re-emergence of skills shortages was a real worry, as the economy returns to growth.
The chief executive of the Australian Industry Group, Heather Ridout says the economy looks set to consolidate this year, but the rebound won’t be as strong as those that occurred after previous downturns.
“Despite the stronger sales and employment expectations, investment trends across these sectors remain soft and conservative,” she said.
“The challenges for policy and for business will be to strengthen the recovery while addressing the ongoing requirement to build on the foundations of longer-term growth.”
The manufacturing partner for Deloitte, Damon Cantwell says 2010 would provide businesses with a range of opportunities to make up ground.
“While 2009 was characterised as a year founded on survival, 2010 offers real opportunities for growth,” he said.