The manufacturing sector continues to struggle under the weight of a strong Australian dollar and a deteriorating global economy, a new survey says.
The Westpac-Australian Chamber of Commerce and Industry survey of industrial trends survey for the June quarter also reported weak conditions in construction outside of the engineering work, which has grown rapidly on the back of the mining boom.
The survey's composite index was little changed at 47.9 points in the June quarter, compared with 47.8 points in the previous three months, but remains below the 50-point level that separates expansion from contraction.
As well, the expected composite index - which points to future industry expectations for the September quarter - was broadly unchanged at 51.7 points, from 51.5 previously.
"While we expect the mining boom to remain a robust support for growth, we continue to believe the non-mining sector will remain weak," Westpac economist Elliot Clarke said in the report released on Thursday.
"In particular, after a strong March quarter, household consumption growth will likely decelerate as the domestic labour market deteriorates and confidence in the global outlook remains low."
The survey's labour market composite index points to an annual employment growth rate of less than one per cent over the next six months, with respondents noting that workers were "harder to get" than three months ago.