Post-election manufacturing bounce fades

THE post-federal election bounce enjoyed by the manufacturing sector already appears to be running out of steam.

Coinciding with a series of high-profile job loss announcements, confidence in manufacturing fell sharply in the first three months of 2014.

The Australian Chamber of Commerce and Industry (ACCI)-Westpac industrial trend survey also shows actual conditions declined during the quarter.

ACCI acting chief economist Burchell Wilson said the result was a "little bit disturbing".

"If actual conditions continue to disappoint expectations, we may see a further correction in the year ahead," he warned reporters in Canberra.

The survey's composite index dropped 5.4 points to 50.9 in the March quarter after spiking in the final three months of 2013, after the September election.

Future expectations for the index tumbled from 60.3 points to just 51.6 points.

However, Westpac senior economist Andrew Hanlan drew some positives from the report, saying the actual composite index held above 50 points for two consecutive quarters for the first time since early 2011, indicating the sector is still expanding.

Export orders posted their best result since 2010/11 and investment also improved.

But most encouraging was the survey's labour index remaining positive for a second quarter in a row and coming off nine consecutive negative quarters.

"It definitely does suggest that employment growth has turned the corner," Mr Hanlan told reporters.

Separate data released by the Australian Bureau of Statistics shows manufacturing jobs grew by 13,900 in the three months to February to 949,700, building on the recovery from 911,500 in in the three months to August, which was the lowest level since the survey began in 1984.

At the other end of the scale, retail jobs declined by 31,800 between September and November.

Retailers want the issue of the GST threshold on foreign goods to be resolved as soon as possible to prevent more jobs being sent offshore.

The ruling that has existed for more than a decade exempts the 10 per cent GST on overseas-bought goods valued at less than $1000.

Australian National Retailers Association (ANRA) chief executive Margy Osmond wants the exemption lowered to $20 to bring it in line with Canada's consumption tax ruling.

In the UK, the threshold is STG15 ($A27.57).

"This is about closing a tax loophole from a time when nobody shopped online," Ms Osmond told reporters in Canberra following a two-day retail leaders forum.

Federal, state and territory treasurers will discuss the issue again when they are expected to meet next Friday, although South Australia's treasurer is still unknown after last weekend's state election.

The ANRA also wants state treasurers to bring some uniformity to trading hours across the nation.

"These laws were written when horses and carriages were around and we need to catch up," chairman John Gillam said.

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