Dimensions of Textile, Clothing and Footwear Production in the High Wage Cost Country of Australia in a Globalised Environment: Some Interesting Revelations

Abstract

This paper seeks to assess the performance of the labour intensive and high wage cost textile, clothing and footwear (TCF) industry in Australia in a globalised environment. The results indicate the Australian TCF industry has become a leaner and more specialised export focused industry by restructuring production from the low to high value added products which exhibit a comparative advantage on the international market. A particularly interesting dimension has been the greater use of high tech production techniques such as bolstering net investment expenditure which has increased the capital intensity of production, undertaking elevated levels of R&D expenditure and using a more skilled labour force which have combined to made it possible to use computer controlled technology and microelectronics to facilitate the production of the higher value added TCF products. This has also combated costs of production and improved the quality of these products thereby reinforcing export competitiveness. The sharper export focus importantly, has provided a platform for sustainable output and employment growth, albeit on a smaller scale. However, this has been associated with large output and hence employment losses.