Strategies and constraints of local and external capital : the dynamics of Tasmania's manufacturing economy, 1980-1985

The objective of this thesis is to analyse the current structure of manufacturing in Tasmania, in terms of enterprise size, location of ownership and control, and other attributes of enterprises which are relevant to the processes of change in regional economic structure and employment. The thesis argues that this is dependent on an understanding of management behaviour and strategy. To satisfy this objective, research adopts a neo- Marxist perspective which emphasises the dynamics of accumulation, power, crisis and conflict within capitalist production. Empirical research evaluates the dynamics of production activities, utilising a process-based approach to investigate the underlying mechanisms producing change within the economy, with particular reference to the specific historic, social and spatial conditions within which these mechanisms are operating. The key element of this process-based approach is an intensive study of 166 manufacturing enterprises throughout Tasmania, centring upon their activities between 1980 and 1985. The research builds upon a narrow range of theoretically-informed studies which focus upon the role of enterprise managers as individual and dynamic actors in generating structural change. As a conceptual structure, research is organised within the segmented economy framework developed by Taylor and Thrift (1981a, 1982a). The segmented economy framework is particularly valuable in that it recognises the variability of enterprise strategy and the importance of power relations both within and between business enterprises. Within the thesis, power relations assessed are those between Tasmanian establishments of multi-site enterprises, independent enterprises in Tasmania, and Tasmanian branch plants and their head offices located outside the state. In terms of total enterprises, Tasmania's manufacturing sector is dominated by small and medium-sized owner-managed indigenous firms manufacturing largely for the limited local market. In terms of employment, however, the state's manufacturing sector is dominated by a few large non-locally owned enterprises manufacturing resource-based, and to a lesser extent filtered-down, products for markets outside the state. Within virtually all indigenous and non-locally owned multi-site firms, branch establishments hold very little power, as most are both small and functionally dependent upon the Tasmanian head office. Within non-locally owned enterprises, the degree of power granted to Tasmanian managers is also low, as control over the relations of economic ownership and possession of capital is held by senior managers of the parent organisation located outside the state. While a number of manufacturers are engaged in either subcontract or franchise activities, few firms are dependent upon these relationships for a large share of their total income. In addition, most inter-organisational relationships are between firms of similar size. Only a few small indigenous firms are operationally dependent upon large manufacturers. The constraints to growth and strategies adopted by Tasmanian manufacturers between 1980 and 1985 are highly complex. Less than one-half of both indigenous and non-locally owned enterprises adopted dominant strategies which were expansion-based over the study period. While most small and medium-sized indigenous operations maintained their level of employment, the majority of both large indigenous and nonlocally owned firms shed jobs in an attempt to restructure their operations by reducing the amount of labour-time required in the production process. While small and medium-sized indigenous firms appear most likely to generate future employment growth within the state's manufacturing sector, significant job gains can only be realised over a long period as few managers of indigenous operations possess the desire or ability to expand markedly the scale of their operations. The dynamic nature of Tasmania's manufacturing economy highlights both the utility of a process-based approach to the study of business organisation, and the need to continually monitor the changes taking place within regional economies. The author concludes the study pinpoints important aspects of the relationships and behaviour which help to explain changing patterns of industrial activity and employment in Tasmania, and that the extension of the segmented economy approach to a detailed regional study of intra and inter-organisational power relations was both valid and extremely worthwhile.