IMPROVEMENTS in technology, the strong dollar and increasing global competition have sent 80,000 service sector jobs overseas in the past four years, putting pressure on the country to reinvent its economy before the mining boom ends.
The erosion of the sector suggests time is running out for Australia to remain globally competitive in higher-skilled service-based industries, according to the report by the Melbourne-based National Institute of Economic and Industry Research.
''The window to build a place in the global industry is closing as other players occupy strategic positions,'' the report said. ''There is a danger facing Australia now that not only will we fail to take a role in the global market but that we will de-skill our workforce by moving key parts of the service sector offshore."
The institute estimates that 20,000 jobs a year in the areas of clerks, accounting, banking and technical support are moving overseas because of technology improvements, the portability of jobs, and the availability of skills abroad, as well as the impact of the strong dollar, which has traded above parity with the greenback for almost two years.
The trend could send 700,000 to 1 million jobs overseas in the next three decades, not just to cheaper countries like India and the Philippines but to advanced economies like the US, Britain and the Netherlands, which are investing in specialised skills.
''The potential for a range of functions to be undertaken remotely with existing or emerging technology is evident in all occupations listed,'' the report said.
After finance, with 24 per cent of jobs ''at risk'' of being sent offshore, 20 per cent of professional, scientific and technical services were at risk. The same proportion of information, media and telecommunications jobs are at risk.
Finance workers, software programmers, call centre workers, project administrators, information and communication technology workers, financial planners, media workers and illustrators are among the other groups at risk of having jobs sent overseas in the next two decades.
The report for Australia's service sectors comes days after the Reserve Bank signalled an earlier end to the mining investment boom, as it cut interest rates to support the weaker patches in the economy.
The slowing of the mining boom is expected to put pressure on the economy, which has been buffered from the global financial crisis through buoyant exports of commodities. The International Monetary Fund has lowered its growth forecast for Australia next year from 3.5 per cent to 3 per cent.
''There is evidence that failure to deal with competitiveness of Australia's services industries is impacting the government's ambition to move towards being a knowledge-based economy and undermining the significant investment being made in education and training services,'' the report said.
While services jobs have been hit hard, 587,000 jobs have been created in the broader economy since September 2008, Bureau of Statistics data show, helped by the mining and non-mining sectors.