Last week, I attended the ASMEX Conference at which the findings of an economic impact study were tabled and discussed. It came as a surprise to NO ONE in the room as we had all been exalting for decades the benefits of the yachting industry to the Australian economy and labour market.
The report detailed the AUD$1.9 billion contribution to GDP the industry currently makes. It also estimated an additional 10,000 jobs and AUD$3.34 billion GDP contribution it could make by 2021 if the regulations for international yachts wishing to charter in Australian waters were changed.
This is personal for me as I am potentially the beneficiary one of those 10,000 jobs. Some of the increase in industry turnover could come from my parents-in-law’s business. My father would enjoy a greater variety of services and marinas for his boat. So I take the government’s interest in this industry’s future very personally.
And yet, I open the paper to read about the future of mining in Queensland, how it is enjoying a resurgence and will add 13,000 jobs for projects lasting five to 10 years. Great news for some; terrifying for others. Wherever you stand on the mining debate, there is little denying the boom and bust nature of it and the manner in which it inflates labour rates only to disappoint once the construction is over. Furthermore, it attracts huge cash injections from governments.
Conversely, the economic impact report confirmed what the yachting industry always knew – it won’t take huge capital investment from government just some changes to regulation. Clearly, this is a small risk so why is it so very difficult for governments to see the increase in GST revenue, high skilled jobs which will be added not to mention the tourism dollars and inward personal and corporate investment from which Australia would benefit.
The answer perhaps lies in the cottage nature of the industry – most companies are small and medium enterprises – and the elitist perception. I would argue these are exactly the reasons it should be the focus of legislators.
Small to medium companies are the back bone of Australia’s economy employing 68.4% of people in the country. As there is no Australian Bureau of Statistics classification for yachting or boating, the impact on the trade balance, employment or GDP is not collected in its own right making it difficult for small companies to argue their importance – hopefully the economic impact report will overcome this problem. It is also an industry heavily centred around regional areas in Australia so plenty of good reasons to take some notice.
Clearly, the end consumers of the yachting industry have a fair amount of discretionary income and influence, in some cases. This does not mean there are huge margins and everyone is flush with money – you don’t get to be a yacht owner without learning to negotiate. It breeds a situation where small companies with little economic negotiating power are operating on tight margins in an environment of market-limiting regulations. Not ideal for growth.
Astoundingly, the same report showed the number of companies and entrepreneurs poised to invest in infrastructure, expand their businesses and employ skilled workers if the regulations change.
So you will excuse me if I take it personally.