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PERTH (miningweekly.com) – The mining boom has substantially increased Australian living standards, a research paper by the Reserve Bank of Australia (RBA) has found.
‘The Effect of the Mining Boom on the Australian Economy’ stated that, by 2013, the mining boom had increased real per capita household disposable income by 13%, raised real wages by 6% and lowered the unemployment rate by 1.25 percentage points.
The report noted that the price of Australia’s mining exports had more than tripled over the past decade, while investment into the sector had increased from 2% of the gross domestic product (GDP) to 8% of the GDP in the same period.
But the boom has also come with costs. “The boom has led to a large appreciation of the Australian dollar that has weighed on other industries exposed to trade, such as manufacturing and agriculture. However, because manufacturing benefits from higher demand for inputs to mining, the de-industrialisation that sometimes accompanies resource booms has not been strong,” the report read.
It was estimated that manufacturing output in 2013 was only about 5% below what it would have been without the boom.
“The combination of changes in income, production and relative prices has meant large changes in the composition of economic activity. While mining, construction and importing industries have boomed, agriculture, manufacturing and other trade-exposed services have declined relative to their expected paths in the absence of the boom,” the report stated.
Australia’s resources and energy commodity export earnings are estimated to increase 11% in 2013/14 to A$196-billion, despite tighter commodity market conditions and lower margins for domestic producers, the Bureau of Resources and Energy Economics had previously reported.
Mineral commodity export earnings were forecast to increase 15% to A$122.9-billion, mainly owing to substantial growth in iron-ore export volumes, while export earnings from energy commodities were forecast to increase 6% to A$73.2-billion, underpinned by higher earnings from liquefied natural gas, crude oil and metallurgical coal.