A new report dramatically predicts that early action to diversify the economy and invest in regional development could ensure the Hunter Valley avoids the worst economic impacts of a decline in coal mining as the world acts on climate change.
The report, Weathering the storm: The case for transformation in the Hunter Valley, was written by researchers at the University of Western Sydney and commissioned by Lock the Gate.
The report models the effect on the Hunter’s economy of a 55% contraction of the coal mining industry by 2040, drawing from modelling by the International Energy Agency that indicates this is the scale of contraction that will occur for thermal coal consumption globally as the world takes action to meet the Paris Agreement goal of limiting global warming below two degrees.
It provides two very different representations of the future:
- A business as usual approach where few adjustments are taken to prepare for the change
- An active approach where the region diversifies significantly in preparation for change
The results of the analysis identify serious disruption if the region does not prepare for the global changes that are underway. Without investment in alternative employment and industry, more than 5,000 jobs and $705m in wages could be lost if global declines in coal occur as predicted.
But the report also found opportunities to diversify the Hunter’s economy using the skills and assets it already possesses. A positive transition scenario would see 595 more new jobs created than are lost from coal mining and local wages and salaries increase by $315 million in 2040.
This scenario builds on the region’s existing strengths in the agriculture, wine-tourism and manufacturing industries, and on the strong skills base already present of machinery operators and drivers, and technicians and trade workers.