Correct. This is evident by the lack of component availability from distributors like RS and Element 14, and the almost complete demise of your local electronics store (Dick Smith is NOT an electronics store and Jaycar is a toy shop.)
Electronics industries on the decline: Automotive (near death), Computer manufacture (dead), Telecommunications (sick).
Reason: Inept politicians and bad policy. High volume, low margin commodities.
Electronics industries on the rise: Medical and niche industries.
Reason: Low volume, high margin products. Third world countries like China and India cannot compete in western markets primarily due to strict FDA/TGA regulations. Innovation is needed to get products on the market. When you are dealing with people's health, only top notch medically accredited western companies with strict R & D and manufacturing processes do well. Australia does very well in medical electronics.
Politicians do not have any experience in manufacturing or R & D. Maybe engineers would not get elected because they don't lie and are not

salesmen. Plus engineers understand control theory which is something politicians and their advisers know little about as demonstrated by Rudd and his insulation and cash splash debacles.
Another reason is high salaries, but generally you get what you pay for. IBM swapped US employees for cheaper outsourced labour in South America and Asia which appears to have resulted in serious damage to the company. I suggest you read the excellent book called
The Decline and Fall of IBM (released this year and the eBook costs about $3 from Amazon).