Shocked by all the closures? Here's the truth behind Australia’s manufacturing collapse
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Australia built its identity on hard work and industry—but what happens when it all disappears?
From peanut butter to plastics, entire sectors have crumbled in recent years, leaving towns and workers reeling.
Now experts warn the collapse isn’t slowing—it’s accelerating.
And the numbers are more alarming than headlines suggest.
In the 12 months to June 2024, 5136 long-standing manufacturing businesses—those operating for five or more years—shut down.
The Australian Industry Group (AI Group) cautioned that more recent figures would likely reveal even deeper trouble.
‘Australian manufacturing as a sector slipped into recession last year and is one of the weakest performing industries in Australia today,’ AI Group chief executive Innes Willox said.
A new AI Group report blamed the ongoing decline on ‘soaring energy and input costs, skills shortages, trade risks and productivity’.
Willox warned of a looming crisis for the almost one million Australians employed in manufacturing, unless urgent national reforms were introduced.
‘We should be worried,’ he said. ‘Manufacturing directly employs 930,000 people, generating over 12 per cent of our exports and 8 per cent of capex investment despite being only 5 per cent of GDP.’
Input prices had soared 37 per cent since the pandemic, far exceeding the 22 per cent inflation rate.
Gas prices alone had risen 48 per cent since 2019, hammering energy-intensive manufacturers and forcing plant closures.
On top of that, a shortage of skilled workers added pressure, with 61 per cent of trades and technician roles proving difficult to fill.
‘Labour productivity in the sector has declined by 3.7 per cent over the past decade and overall productivity is down by 1 per cent,’ Willox said.
The downturn made it harder to offer sustainable wage increases and weakened Australia’s global competitiveness—particularly as international trade tensions intensified.
Treasurer Jim Chalmers is expected to lead an economic reform roundtable in Canberra next month to address issues like energy, workforce, productivity and international competitiveness.
AI Group has previously flagged concerns that Australia’s public sector jobs boom is concealing private sector weakness.
In 2024, 80 per cent of all new jobs were created in either public service or government-funded sectors such as healthcare and education.
Here are just a few of the industries already lost—or close to collapse.
Peanut Butter
Last week, Bega Group announced it would close the century-old Peanut Company of Australia (PCA), risking up to 150 jobs.
Based in Kingaroy, Queensland, PCA had been the heart of Australia’s peanut industry since 1924.
Bega blamed ‘sustained financial pressure’ and mounting annual losses of $5–10 million, saying it had failed to find a viable business model despite strategic reviews and attempts to sell the business.
‘It has rocked our community, as Kingaroy is the home of peanuts and the silos are an iconic part of the region’s history—that is why they are heritage listed,’ said South Burnett Mayor Kathy Duff.
Cars
Australian car manufacturing officially ended in October 2017 with the closure of Holden’s Elizabeth factory in Adelaide.
Toyota and Ford had already ceased operations, following Mitsubishi’s exits in 2004 and 2008.
The federal government declined to continue subsidising manufacturers, arguing that market changes—like consumer preference for SUVs—were behind the shutdowns.
But industry experts said Australia’s high labour costs and lack of supportive policy made it impossible to compete with cheaper imports.
Tyres
Bridgestone shut its Australian and New Zealand factories in 2010, citing unviable operating conditions.
Around 600 Adelaide jobs were lost, along with 275 in Christchurch.
Goodyear closed its Melbourne site in 2008, with plans to shift focus to low-cost production hubs in Asia-Pacific.
Glass
Melbourne-based Oceania Glass collapsed into insolvency earlier this year, ending a 160-year legacy.
The company, which once supplied glass for Parliament House, was hit by a $1.2 million annual loss and rising import competition from China and Thailand.
Union leaders blamed a lack of anti-dumping enforcement for the flood of cheap imports threatening Australian-made products.
Clothing
In 1985, over 90,000 Australians worked in textile, clothing and footwear manufacturing.
Today, fewer than 1000 remain in the sector.
Iconic names like Bonds and Berlei moved offshore after tariff protections were dismantled in the 1980s.
The Australian Fashion Council argued that automation and post-Covid shifts could offer a path back—if local investment returned.
Paper
White paper production ended in Australia in December 2022, after Opal Australian Paper ceased operations at its Maryvale mill in Victoria.
The move followed a court ruling that halted logging by VicForests, a key supplier.
The loss of timber supplies, rising costs and Covid-related disruptions triggered a wider financial spiral across the company.
Maryvale continues to make brown paper, but 200 jobs were lost when white paper production ended.
Steel
Whyalla Steelworks in South Australia is under administration, with $1.5 million in daily losses and $1.34 billion in debt.
Built in 1941 and previously rescued by billionaire Sanjeev Gupta in 2017, the plant never received the upgrades that were promised.
BlueScope remains the country’s largest producer, supported by a recent $200 million federal government rescue package.
But rising energy costs and foreign competition have kept the industry in a fragile state.
Plastics
Qenos, once Australia’s largest plastics manufacturer, went into administration in 2023 due to soaring gas prices and major financial losses.
The company produced polyethylene used in packaging and other household items.
Closures at its Melbourne and Sydney sites left 700 workers out of jobs.
Trident Plastics, based in Adelaide, collapsed the same year.
Dow Chemical had already exited in 2019.
Willox described the collapse of Qenos as a sign of deeper structural issues affecting Australia’s entire industrial supply chain.
If you thought the peanut butter plant closure was shocking, it’s just one part of a larger pattern hitting industries across the country.
Factory shutdowns are becoming more frequent as rising costs, global competition, and supply chain issues take their toll.
One recent example involves a century-old site facing the same grim fate, with hundreds of jobs now on the line.
Read more: Iconic 100‑year‑old factory shuts down as hundreds of jobs hang in balance
What happens to a country when it stops making the things it needs?
From peanut butter to plastics, entire sectors have crumbled in recent years, leaving towns and workers reeling.
Now experts warn the collapse isn’t slowing—it’s accelerating.
And the numbers are more alarming than headlines suggest.
In the 12 months to June 2024, 5136 long-standing manufacturing businesses—those operating for five or more years—shut down.
The Australian Industry Group (AI Group) cautioned that more recent figures would likely reveal even deeper trouble.
Manufacturing shutdowns surge past 5,000 in one year. Image source: Pexels/lil artsy
Disclaimer: This is a stock image used for illustrative purposes only and does not depict the actual person, item, or event described.
Disclaimer: This is a stock image used for illustrative purposes only and does not depict the actual person, item, or event described.
‘Australian manufacturing as a sector slipped into recession last year and is one of the weakest performing industries in Australia today,’ AI Group chief executive Innes Willox said.
A new AI Group report blamed the ongoing decline on ‘soaring energy and input costs, skills shortages, trade risks and productivity’.
Willox warned of a looming crisis for the almost one million Australians employed in manufacturing, unless urgent national reforms were introduced.
‘We should be worried,’ he said. ‘Manufacturing directly employs 930,000 people, generating over 12 per cent of our exports and 8 per cent of capex investment despite being only 5 per cent of GDP.’
Input prices had soared 37 per cent since the pandemic, far exceeding the 22 per cent inflation rate.
Gas prices alone had risen 48 per cent since 2019, hammering energy-intensive manufacturers and forcing plant closures.
On top of that, a shortage of skilled workers added pressure, with 61 per cent of trades and technician roles proving difficult to fill.
‘Labour productivity in the sector has declined by 3.7 per cent over the past decade and overall productivity is down by 1 per cent,’ Willox said.
The downturn made it harder to offer sustainable wage increases and weakened Australia’s global competitiveness—particularly as international trade tensions intensified.
Treasurer Jim Chalmers is expected to lead an economic reform roundtable in Canberra next month to address issues like energy, workforce, productivity and international competitiveness.
AI Group has previously flagged concerns that Australia’s public sector jobs boom is concealing private sector weakness.
In 2024, 80 per cent of all new jobs were created in either public service or government-funded sectors such as healthcare and education.
Here are just a few of the industries already lost—or close to collapse.
Peanut Butter
Last week, Bega Group announced it would close the century-old Peanut Company of Australia (PCA), risking up to 150 jobs.
Based in Kingaroy, Queensland, PCA had been the heart of Australia’s peanut industry since 1924.
Bega blamed ‘sustained financial pressure’ and mounting annual losses of $5–10 million, saying it had failed to find a viable business model despite strategic reviews and attempts to sell the business.
‘It has rocked our community, as Kingaroy is the home of peanuts and the silos are an iconic part of the region’s history—that is why they are heritage listed,’ said South Burnett Mayor Kathy Duff.
Cars
Australian car manufacturing officially ended in October 2017 with the closure of Holden’s Elizabeth factory in Adelaide.
Toyota and Ford had already ceased operations, following Mitsubishi’s exits in 2004 and 2008.
The federal government declined to continue subsidising manufacturers, arguing that market changes—like consumer preference for SUVs—were behind the shutdowns.
But industry experts said Australia’s high labour costs and lack of supportive policy made it impossible to compete with cheaper imports.
Tyres
Bridgestone shut its Australian and New Zealand factories in 2010, citing unviable operating conditions.
Around 600 Adelaide jobs were lost, along with 275 in Christchurch.
Goodyear closed its Melbourne site in 2008, with plans to shift focus to low-cost production hubs in Asia-Pacific.
Glass
Melbourne-based Oceania Glass collapsed into insolvency earlier this year, ending a 160-year legacy.
The company, which once supplied glass for Parliament House, was hit by a $1.2 million annual loss and rising import competition from China and Thailand.
Union leaders blamed a lack of anti-dumping enforcement for the flood of cheap imports threatening Australian-made products.
Clothing
In 1985, over 90,000 Australians worked in textile, clothing and footwear manufacturing.
Today, fewer than 1000 remain in the sector.
Iconic names like Bonds and Berlei moved offshore after tariff protections were dismantled in the 1980s.
The Australian Fashion Council argued that automation and post-Covid shifts could offer a path back—if local investment returned.
Paper
White paper production ended in Australia in December 2022, after Opal Australian Paper ceased operations at its Maryvale mill in Victoria.
The move followed a court ruling that halted logging by VicForests, a key supplier.
The loss of timber supplies, rising costs and Covid-related disruptions triggered a wider financial spiral across the company.
Maryvale continues to make brown paper, but 200 jobs were lost when white paper production ended.
Steel
Whyalla Steelworks in South Australia is under administration, with $1.5 million in daily losses and $1.34 billion in debt.
Built in 1941 and previously rescued by billionaire Sanjeev Gupta in 2017, the plant never received the upgrades that were promised.
BlueScope remains the country’s largest producer, supported by a recent $200 million federal government rescue package.
But rising energy costs and foreign competition have kept the industry in a fragile state.
Plastics
Qenos, once Australia’s largest plastics manufacturer, went into administration in 2023 due to soaring gas prices and major financial losses.
The company produced polyethylene used in packaging and other household items.
Closures at its Melbourne and Sydney sites left 700 workers out of jobs.
Trident Plastics, based in Adelaide, collapsed the same year.
Dow Chemical had already exited in 2019.
Willox described the collapse of Qenos as a sign of deeper structural issues affecting Australia’s entire industrial supply chain.
If you thought the peanut butter plant closure was shocking, it’s just one part of a larger pattern hitting industries across the country.
Factory shutdowns are becoming more frequent as rising costs, global competition, and supply chain issues take their toll.
One recent example involves a century-old site facing the same grim fate, with hundreds of jobs now on the line.
Read more: Iconic 100‑year‑old factory shuts down as hundreds of jobs hang in balance
What happens to a country when it stops making the things it needs?
