By Claire Reilly
As workers at Electrolux’s manufacturing facility in Orange await news of the factory’s future, the head of the Australian Manufacturing Workers’ Union (AMWU) has said the closure of the factory would have an “enormous impact” on the regional town.
The Orange factory, located in central western New South Wales, has been manufacturing whitegoods since 1946, producing Electrolux, Kelvinator and Westinghouse refrigerators and freezers and Simpson chest freezers for the local market. However, by the end of this year Electrolux’s corporate head office will make a decision on the future of the facility, choosing whether to continue operations or close the Orange factory and invest resources in the company’s facility in Thailand instead.
Paul Bastian, acting national secretary of the AMWU, spoke to Current.com.au about the future of the Orange factory and Australian manufacturing as a whole, saying Australia needs to support the industry if it is going to survive.
“Manufacturing has got a good future here in Australia,” said Bastian. “It is a very important part of our economy by any measure that you like to take — whether that’s in terms of the million people it employs, its total sales, exports, its percentage of GDP, research and development — by any of those measures, manufacturing is critical to our economy now and into the future.”
Despite this importance, Bastian said the local industry had taken a beating through the GFC and thanks to the rising Australian dollar, which he said was the “single most contributing factor” impacting the manufacturing sector in this country.
“Partly the problem we have is that there is not a level playing field when it comes to the way we behave in the market and looking after our industries. I’m not talking about protection, I’m talking about building a culture where you can attract investment into Australia.
“The biggest single issue is whether or not government is prepared to assist companies make the transition to a high-cost environment. We’ve had an under-investment in skills, we’ve had an under-investment in terms of technology and equipment and we’ve had the high Australian dollar. They’re the sort of things that we need to start to address.
“We need a government that’s prepared to recognise that the economy is in transition, that manufacturing is in transition, and it needs to be prepared to put the right policy settings in to assist companies.”
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Ultimately, Bastian said Australia would never be able to compete with low-cost countries such as Thailand, but this was not necessarily a deal breaker.
“If you look at high-cost countries around the world that are able to compete on manufacturing —Germany, Denmark, Sweden, Norway — all of those areas operate in high-cost environments, all have very competitive manufacturing sectors, and it’s because they invest in their industries.
“They invest in skills, they invest in research and development, they invest in innovation, and very importantly, they engage their workers in terms of their involvement in making the enterprise more efficient and productive.
“If it’s simply a question of low wages and saying, ‘We can’t compete with low wages’ then we should turn out the light. We will never be able to compete on the basis of wages. Australia is known for its ability to produce quality products. It’s known as a good place to do business, but what it does need is assistance to transition to a high-cost environment.”
With roughly 520 staff at the Orange Electrolux factory the stakes are high, but the ramifications of a closure will be felt by more than just the workers according to Bastian.
“First and foremost it has an enormous impact on the workers and their families and their community. Secondly it will have a great impact on Orange — [the factory] is the centrepiece of their economy. If that place was to close, it would have an enormous impact on regional Australia in terms of Orange. It will also in our view send all the wrong signals about manufacturing in this country.
“Once you lose that capability to be able to produce, once you lose those skills, it is very very hard to regain that ground.”