KPMG report predicts 85,000 new jobs for Adelaide, backed by defence, advanced manufacturing

A jobs boom fuelled by the defence and advanced manufacturing sectors will lure Gen Z and millennial workers to Adelaide, according to a new report from KPMG.

Boilermaker Scott Griffiths operates a plasma cutter to produce the first piece of steel to be used on the first Hunter class frigate to be constructed at the Osborne shipyard. Picture: NewsWire / Brenton Edwards

The burgeoning defence, advanced manufacturing and clean energy sectors are expected to drive a jobs bonanza across Adelaide over the coming years, backed by a growing number of Gen Z and millennial workers choosing to call the city home.

A new report from professional services firm KPMG predicts that 85,000 new jobs will be created in Adelaide over the next five years, with most of the opportunities emerging in hi-tech industries as the city moves on from its traditional manufacturing past.

KPMG Adelaide chairman Justin Jamieson said new career opportunities in growing hi-tech industries, combined with the relative affordability of Adelaide when compared to larger cities on the east coast, was helping to attract and retain young people and families who would have previously moved to Melbourne or Sydney.

“Manufacturing has been a cornerstone of the Adelaide economy. Now we are seeing manufacturers pivoting towards hi-tech sectors, with a focus on renewable energy and defence projects,” he said.

Artist's impression of the Barn Hill wind farm and battery project proposed near Red Hill. Green energy projects are expected to be a main driver of jobs growth in Adelaide. Picture: Supplied by AGL

“Adelaide is becoming a global leader in wind and solar electricity production and critical mineral exports, boasting the world’s largest zircon mine (Jacinth-Ambrosia operation 200km north-west of Ceduna) and significant graphite and cobalt resources, along with substantial heavy rare earth elements.​

“The diversification of Adelaide’s economy is not just seeing the city retain its younger residents but also enticing workers from Melbourne and Sydney who are attracted to the city’s lifestyle, relative affordability and career opportunities.”

KPMG’s Enterprising Cities report, which tracks economic and jobs growth in 12 of Australia’s fastest-growing second tier cities, shows South Australia’s population of 20-39 year olds increased by close to 10,000 in 2024 – the strongest growth rate of all age groups.

KPMG Adelaide chairman Justin Jamieson. Picture: Supplied

Health care is the largest and fastest-growing industry in Adelaide, according to the report, employing 145,500 workers in 2024, up from 107,000 workers in 2019, as spending on the NDIS and aged care continues to rise.

It’s followed by retail, construction and professional services, while manufacturing – previously a cornerstone of the economy – comes in sixth after reporting only a modest increase in employment from 52,500 workers in 2019 to just 53,500 in 2024.

Defence is not listed as a stand-alone industry, but is expected to be one of the main drivers of growth over the coming years, as work on the $45bn frigates build and AUKUS submarine program ramps up at the Osborne shipyards.

Overall, jobs growth is expected to come in at 2.1 per cent annually over the next five years, down from the 2.5 per cent reported over the past five years as the local economy continued its recovery from the pandemic.

After slipping to just 0.1 per cent in 2020, employment growth peaked at 5 per cent in 2022 before sliding back to 1.2 per cent in 2024.

Originally published as KPMG report predicts 85,000 new jobs for Adelaide, backed by defence, advanced manufacturing