The James Martin Institute for Public Policy (JMI) has released a report outlining key policy opportunities to enhance the adoption of Industry 4.0 technologies in NSW manufacturing.

Small and medium enterprises (SMEs) are the bedrock of NSW’s manufacturing industry, making up 99 per cent of manufacturing firms in NSW. They underpin the state’s significant contribution to Australia’s total manufacturing income and workforce.

Embracing advanced technologies is critical for manufacturing firms’ competitiveness and growth. However, many SMEs have been slow to adopt advanced digital technologies, missing out on improved performance and economic impact.

Authored by Associate Professor Dilupa Nakandala from Western Sydney University as part of her JMI Policy Fellowship, Recharging SME manufacturing in NSW identifies strategic actions to drive technological adoption and enhance industry productivity.

“Adopting Industry 4.0 technologies has wide-reaching benefits for NSW’s manufacturing sector, but SMEs often get left behind in their ability to benefit from them,” Nakandala said. “My research outlines concrete steps for policymakers to close the technology readiness gap between large and small firms. By tackling barriers and enhancing support, we can unlock SMEs’ full potential and boost productivity, resilience and sustainability.”

This timely report coincides with the NSW Government’s ongoing development of a new Industry Policy and Innovation Blueprint. This effort aligns with the Commonwealth Government’s Future Made in Australia Act, which aims to enhance investment, create jobs, and seize economic opportunities nationwide.

Key opportunities identified in the report include:

• Boosting awareness of the benefits of Industry 4.0 technologies among manufacturing SMEs;
• Providing bespoke, end-to-end support to facilitate the adoption of advanced technologies;
• Encouraging the exchange of technological expertise within the manufacturing sector; and
• Increasing the accessibility of Industry 4.0 technologies to SMEs.

The report calls for a collaborative effort involving the NSW Government, local councils, SMEs, large manufacturing firms, educational institutions, financial entities, and technology providers to implement the proposed strategies and drive meaningful change. This would not only have important knock-on effects on economic growth and employment but can also improve the everyday lives of Australians through increased manufacturing outputs and regional resilience.

Libby Hackett, CEO of JMI, commented, “Smart manufacturing is one of the key priorities of the NSW Government, and SMEs play a critical role in this sector. By pursuing the opportunities outlined in this report, we can empower NSW’s manufacturing sector to leverage digital innovations, drive productivity, and maintain a competitive edge in a rapidly evolving global market.”

JMI Policy Fellows pursue independent and rigorous policy-relevant research with a strong potential to generate public value and impact.

For more information about the report, please contact [email protected].