Australia will need to have its resources allocated to the most competitive production possible. Instead the public usually sees the factory closures and is made aware of some costs that nearly always accompany change of any type. Trade liberalisation tends to be a scapegoat for any adverse effects of a range of changes in the way we work and live. Tariffs can protect jobs in the short term but cannot provide job security in the long term. Tariffs also impose costs that reduce opportunities and jobs in other more efficient and competitive industries.
Tariff protection have little long term impact on employment trends.
Experience, both here and overseas, is that employment has fallen in highly protected industries, even during periods of high and increasing tariffs. Job shedding is driven by factors such as rapid technological change and domestic reforms, which can make industries healthier, more competitive and more productive and, in the longer term, these will create more jobs. Tariffs lift the costs faced by Australian exporters by around 3 per cent, holding back their output, reducing their exports and retarding job growth, especially in sectors that service export production. Trade liberalisation in Australia has helped create jobs in many service industries and in manufacturing, particularly at the higher value-added end of processes. But higher exports do not always mean more jobs in that exporting firm or industry.