Not all good things last. Or perhaps, some good things HAD to last.

Australia may already need to create alternative options if it wants to secure the momentum of its economic growth in years to come after a new research indicated the country has saturated the economic benefits of its mining boom.

Although federal government boasted some A$430 billion (S$565 billion) in mining investment has yet to materialise for Australia, the much touted boom is no longer creating a parallel exponential effect in the country's fiscal health.

''The boom is no longer boosting growth in the Australian economy nor contributing to additional improved welfare for Australian citizens,'' Victoria University economist Peter Sheehan said in the Australian Economic Report.

"Although the boom continues and mining investment will increase, its net benefits for the economy have peaked," he added.

Mr Sheehan is a director of the university's Centre for Strategic Economic Studies. He co-authored the study with former Reserve Bank Board Member Professor Bob Gregory.

Australia is abundant in natural resources, prompting mineral resource-hungry nations such as Japan, China, South Korea, India and the USA to stalk the country to feed their requirements. The resulting strong appetites helped Australia fight recession as well as anchor its economic health during the global downturn. Prices of global commodities escalated, boosting national income. All these ultimately placed Australia on the map of world as one of its emerging market leaders.

The study noted that over the eight-year boom, Australia's export prices skyrocketed, elevating the exchange rate by 65 per cent as well as holding up local incomes.

But not all good came out of the mining boom as it exacted a toll on a number of local industries, primarily manufacturing. In Western Australia alone, manufacturing jobs plunged 22.4 per cent in the past three years. National manufacturing employment registered a decline of 10.2 per cent in the same period.

Jobs in the tourism and education sectors have also been rendered vulnerable, adding to the slowdown in Australia's economy.

"The domestic economy is slowing - real gross domestic product growth rose only by 1.4 per cent over the past year, while employment has been virtually flat in the first nine months of 2011, with unemployment rising a little," the study said.

Although new mining projects continue to abound for Australia, it gives little direct benefit to the Australian economy as most are foreign owned.

Just 20 per cent of the mining industry is locally owned, meaning most profits flows to foreign companies, the study said.

In October, Western Australian Premier Colin Barnett had expressed concerns over the rising presence of foreign interests in the country's mines. He said state and federal governments must safeguard Australia's mineral resources won't be all too consumed by foreign investors and that a stable food and resource security for the country's domestic use is ensured.

And with the global trend to shift to clean energy sources, particularly liquefied natural gas, all the more that Australia needs to get its act fast. For this sector, specialist equipment mostly come from overseas, meaning little capital is spent in Australia, the study said.

"Although the boom continues, its net benefits have peaked. Year-on-year it is no longer boosting economic growth, or helping improve Australians' welfare. The positive effects of the boom have become more muted, while the negative effects are becoming more pronounced," Mr Sheehan said.

The authors urged Australia must find other economic drivers.

"The nation must find new sources of growth, and adjust to a new reality of a high exchange rate but without further stimulus from mining. The boom has underwritten the economy for almost a decade. The new challenge is to shape policy in different circumstances for the next decade. In the near term this will mean further interest rate cuts and a shift to a more expansionary fiscal policy," Mr Sheehan said.

The authors advised government not to push the economy down further by cutting spending in a bid to bring the budget back into surplus, adding further reductions in interest rates imposed by the Reserve Bank of Australia may be necessary to boost spending and stimulate the economy.

"With the mining boom boosting the economy further each year, it made sense for the government to take $50 billion out of the economy, or 3.6 per cent of GDP over two years, to achieve a budget surplus in 2012-13. Without the ongoing boost from mining and with the economy slowing this is no longer appropriate. Fiscal policy needs to be much less restrictive and more supportive of growth," the study said.