On-going weakness in the labour market, highlighted by job shedding in a range of sectors, is a stark reminder of the need for renewed action on economic reform, according to a statement by ACCI's Director of Economics and Industry Policy, Mr Greg Evans.

Australian needs government action to restore confidence especially in the most vulnerable sectors of the economy.

Continued global uncertainty, subdued business and consumer confidence levels and serious adjustment pressures in the trade exposed sector will unfortunately continue to feature in 2012, therefore, policy settings--including monetary policy--need to be more accommodative of these circumstances.

Beyond the buoyancy of the mining and mining related sector many are areas of the economy--including housing construction, manufacturing, retail and even financial services-- are being squeezed by higher costs and subdued demand conditions.

Recent survey work by ACCI nominates business taxes and government charges, followed by insufficient demand as the key concerns which are constraining business investment.

The widespread tax reform agenda needs another jolt including shelving the productivity sapping carbon tax which will further add to the cost burden carried by industry and pointlessly add to the competitive pressures faced by Australian business.

Winding back the impact of payroll tax needs to be addressed, this tax hits manufacturing hard and is levied irrespective of the profitability of a company.

Other tax reform measures including improved capital allowance measures to promote investment also need to be on the agenda.

ACCI supports the government's intention to return the budget to surplus in 2012 - 2013, what also needed is a root and branch review of government expenditure to consider the size of government and opportunities to further cut waste and inefficiency.

Our current economic circumstances dictate that we have greater focus on reform including ensuring we maintain a flexible labour market, promoting opportunities for skill development and investing in infrastructure that passes rigorous cost benefit tests.

As 2012 opened, ACCI released a ten-point plan for Jobs and Growth. Every new job loss tells us why we need action on this plan.