No economic benefit from NT cotton: submission

by Rod Campbell and Sumithri Venketasubramanian

Research released today by The Australia Institute shows that a cotton industry in the Northern Territory would not bring significant employment or tax payments.

The findings were submitted to the NT Government’s water policy consultation process, which closed yesterday.

Key points:

  • The cotton industry does not create significant employment in Australia. Cotton growing employs just 1,121 people nationwide, or 0.4% of the agricultural workforce.
  • Ginning, the basic processing of cotton, employs just 466 people in Australia.
  • Even in key cotton producing areas, typically 95% of employment is not related to cotton.
  • Australian Tax Office data shows major cotton producers pay little to no company tax.

“The reality is that cotton uses a lot of land, water and machinery but creates very few jobs,” said Rod Campbell, Research Director at The Australia Institute.

“You would be hard pressed to find an industry with less employment potential for the Territory than cotton.

“Minister Manison has urged critics to consider the benefits of new irrigation developments. Our submission goes looking for those benefits and they just aren’t there.

“The Territory Government is looking to give away valuable water based on industry claims of jobs and revenue. Those claims don’t stack up.

“Subsidising the cotton industry with free water and publicly-funded processing is bad economics and bad environmental policy.

“Given the minimal employment and minimal public revenue that a cotton industry would bring, it is highly unlikely that a subsidised cotton industry represents a net economic benefit to Territorians,” said Rod Campbell.

Related research