After the mining boom, the jobs will keep flowing to the service industry - China is behind Australia's economic progress, initially buying minerals and latterly with Chinese coming as students and tourists

It's a question doubting customers have been asking me through the whole of my career: but where will all the jobs come from? We worry about jobs, convinced there's never enough of them.

Whenever we're in a recession, with unemployment high and rising, people simply can't see how we'll ever get it down again.

In the more recent resources boom, a lot of people got jobs in faraway places helping to build new mines and natural gas facilities, but we knew that wouldn't last.

Mining now accounts for about 10 per cent of the value of the nation's production – gross domestic product – but it still employs only about 2 per cent of the workforce.

When the three foreign car makers announced in 2013 that they'd be ending Australian production later this year or next, the familiar cry went up: where will the new jobs come from?

It was a question I used to find hard to answer, but now I don't. When I started in this job more than 40 years' ago, there were 5.8 million people in the workforce. By now it's more than doubled to 11.9 million.

So the jobs did come, despite 40 years of worrying that they wouldn't. Where did the come from? I could work out from the figures how many came in which particular industries, but I'll skip to the bottom line: virtually all the extra 6 million jobs came from the services sector.

Where will the jobs be coming from in the years ahead? Same place. Indeed, they already are.

Our most recent worry has been where our economic growth would come from now coal and iron ore prices are falling and no new mining construction projects are taking the place of completing projects.

But the evidence is coming in. We're experiencing strong expansion in parts of the vast services sector, which is generating lots of extra jobs.

Whereas mining – and farming and, these days, even manufacturing – are capital-intensive, and so provide few jobs, service industries are labour-intensive, and so provide lots of 'em.

From a job-creating perspective, the trouble with physical things – "goods" – is that it's been relatively easy to use machines to replace workers, whereas you still need a lot of people to provide services, even when those people are given better machines to help them.

The other trouble with goods industries is that there's a limit to how many things – clothes, cars, fridges, laptops – you want to own. Time has shown there's almost no limit to the number and kinds of services we'd like others to perform for us.

Did you know there's such an occupation as "lactation consultant"? There used not to be, but there is now.

These are the reasons why almost all the extra jobs being created are in the services sector.

Last year, total employment grew by a very healthy 300,000 jobs, more than half of them full-time.

Research by Professor Jeff Borland, of the University of Melbourne, has found that more than 90 per cent of these jobs occurred in the private sector.

This private sector growth was concentrated in NSW and Victoria, whereas the growth in public sector employment was concentrated in Queensland and South Australia.

But where did the additional jobs come from? Fully a third – 100,000 – were in (the mainly private sector parts of) healthcare. Then came 75,000 in businesses providing professional and technical services, almost 50,000 in retailing, more than 40,000 in financial services and more than 30,000 in administrative and support services.

The thing to note about that list is that while some of those jobs would have been low-skilled, many – particularly those in professional services and healthcare – would have been high-skilled, well-paid and intellectually satisfying. But even the lesser-paid jobs would have been clean and safe.

So don't turn up your nose at services sector jobs.

And get this: the extra jobs went disproportionately to older workers. Although people aged 45 and above account for only 31 per cent of the overall workforce, they accounted for 57 per cent of the growth in jobs.

But wait, there's more. Though we keep hearing about the growth in the quantity of our mineral exports as the new mines come on line, we've heard far less about the growth in the quantity of our exports of services, particularly education and tourism. (We "export" services when foreigners come to Oz to receive them.)

Our service exports have benefited greatly from the fall in our dollar, which has made them cheaper to foreigners.

Last year, spending by international students on course fees, accommodation, living expenses and recreation grew by 13 per cent to more than $19 billion. Spending by foreign tourists in Australia rose by 11 per cent to almost $16 billion.

What's more, our lower dollar has encouraged many Aussies to take their holidays at home rather than abroad. We now have more tourism money coming in than going out.

You well know it was exports to China that did most to fuel the resources boom. What nobody's bothered to tell you is that it's China and its growing middle class that's doing most to boost our exports of education and tourism services.

Don't underestimate the contribution services are making to "growth and jobs".

Ross Gittins is the Herald's economics editor. Illustration: Kerrie Leishman