JEFF Drayton is "amongst the best" of "hundreds" of candidates veteran Labor MP Joel Fitzgibbon has campaigned with, but the union official's failure to win votes outside where he was best known proved his undoing.
Mr Drayton conceded victory to the Nationals David Layzell on Sunday morning, saying they "don't agree on many things" but both "have the best interests of the Upper Hunter at heart".
The coal miner turned union official thanked voters for "huge support" in Muswellbrook, Denman, Aberdeen and Sandy Hollow, but said that could not be replicated in other parts of the electorate.
Labor had faced an "uphill battle" to claim an upset, Mr Drayton said, but the outcome was a telling result for the party two years out from the next general election.
"Our result ... particularly in Singleton, is a warning to Labor that we can't take any community for granted," he said.
"Working class communities are hurting and they're turning away from this government.
"However, right now, they don't see Labor as the answer.
"Labor needs to do some real soul searching as to how we will win these communities back. It's going to take honest reflection and a lot of hard work."
Federal Labor MP Joel Fitzgibbon praised Mr Drayton, suggesting the result could have been far worse.
"Thank goodness we ran Jeff," he said.
"Where Jeff was best known he did exceptionally well.
"But to barely have a 2 in front of our primary vote should be a real wake-up call for the Labor party."
Mr Fitzgibbon said with more time to campaign and become known, Mr Drayton would be a strong candidate for the party run again.
"I would like to see him put his hand up again," he said.
"He is well known, he is liked, he is sensible, is a thinker and just has a really common touch."
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