Navy Ship Building Contracts Will Create Significant Opportunities For Western Australia.

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May 12th, 2016

Navy ship building contracts will create significant opportunities for Western Australia.

The long awaited announcement that Western Australia has been awarded a major tranche of the $40 billion Maritime Renewal Project is a much needed boost for the local ship building industry and great news for Western Australian workers. The latest announcement follows the welcome news that WA defence bases will have $4.3 billion spent on them over the next two decades, an investment which will provide a much needed injection of funds into the local economy and will support employment through the creation of many highly skilled jobs.

Don’t discount the multiplier effect of large projects; The so called multiplier effect of this type of investment on jobs in the local economy is significant. The most discernible being the direct impact of operating a business. Things like the purchase of inventory, utilities, equipment and payment of employees and State and federal taxes.

Indirect impact happens as dollars flow to other areas of the economy creating jobs as a range of goods and services are purchased from local businesses. Induced impact occurs at the household level when consumer confidence is high and employees, business owners and others spend their disposable income in the local economy. Currently, Western Australia is home to about 180 companies with direct defence contracts, the majority of which are small to medium enterprises.

Good news in a time of transition and diversification; With commodity prices low and as many major projects in the mining and resources sector transition from the construction to the operational phase, demand for skilled labour in the this sector is in decline. News that a new long-term contract for the maintenance of the ANZAC Class Frigates will be centred in WA is good news for Western Australia’s highly trained workforce and further cements the State's role in the ongoing sustainment of the Royal Australian Navy (RAN) fleet, a project with a potential value of more than $2 billion over the first eight years.

Austal- Australia's most successful shipbuilder; Other winners include the Australian Marine Complex (AMC) at Henderson, home to Austal Ships who were awarded a $305 million contract to construct and maintain up to 21 replacement steel-hulled Pacific Patrol Boats as part of the Pacific Patrol Boats Replacement (PPBR) Project.

These 39.5m steel vessels will be designed and constructed by Austal for delivery to up to 13 Pacific Island nations from late 2018. Not only do contracts of this nature further enhance Austal’s reputation as a prime global defence contractor and a designer and manufacturer of defence and commercial ships, they provide long term certainty for jobs and ship building at the Australian Marine Complex in Henderson while creating a solid foundation for further growth.  

Large projects need skilled workers; As we saw during the resources boom, the success of any project is directly influenced by industry’s access to an appropriately skilled and properly trained workforce. Sure People Solutions are committed to workforce planning and development initiatives which provide Australian workers with the skills and experience to build and maintain Australia’s navel requirements now and into the future.

Check back regularly for more updates.