MUNGO MacCALLUM. After all the promises, dithering, the backflips and the bullshit, the unemployment rate has not actually fallen

May 29, 2018

There can be no real doubt that the timing of the by-elections for July 28 was mean and tricky. But who was the mean trickster?  

Not me, asserts an outraged Tom Rogers, the electoral commissioner who told the government this was his optimal date; he was steadfastly non-partisan. But he did admit that he wanted to give the minor parties time to work through the register of eligibility the government has devised.

However, while this sounds a bit political, his idea for a nine week campaign will massively disadvantage the minors since at every level they will be outgunned by the resources of the major parties, so perhaps it doesn’t matter.

And the final decision was Malcolm Turnbull’s, although the Speaker, Tony Smith, obediently uttered the fateful words. Our Prime Minister believed that not only could he disrupt Labor’s plans for its national conference, but that he could win the war of attrition that will surely follow.

So the pseudo national poll is on: pity about the actual administration of government for the next couple of months. But there is a hitch: even Turnbull will have to talk about something other than Unbelieva-Bill at some point, and frankly he hasn’t much else.

The hitherto interminable company tax plan has finally been kyboshed by Pauline Hanson and the new personal tax plan, with which Scott Morrison has embraced trickle down politics along with his passion for trickle down economics, does not envisage useful outcomes for the masses for another ten years – pie in the sky if we don’t die first.

So what is there? One million new jobs.

One million new jobs, have you got the message? If not, don’t worry – over the next nine terrible weeks you’ll have plenty of time to have it seared into what is left of your battered brain.

At least it has the virtue of simplicity: one million new jobs, and delivered even more quickly than the five years promised. Actually over one million – 1,013,600 and counting. A truly impressive number.

Well, up to a point, Prime Minister. It is an important number, but so is another one: 5.6 per cent. That is the official unemployment rate and by no coincidence at all it is precisely the figure it was when Tony Abbott made his million jobs pledge in 2013.

In other words, where jobs are concerned, we are doing no more than holding the line, running on the spot. The reasons are obvious: the population is growing, and thus the available workforce is continually increasing as it always has and presumably will continue to do so.

The three principal components are breeding (we have not quite got to Peter Costello’s agenda of two for the parents and one for the country but we are not turning celibate either), migration, and the fact that more women are actively looking for work. Although there is a current kerfuffle over migration, triggered by Dick Smith and latched on largely by covert xenophobes, most economists regard all three of these factors as welcome, net plusses to the Gross National Product.

But the demonstrable fact is that they are not delivering the jobs and growth we were promised; at best we are standing still. Obviously we need more infrastructure spending to provide the housing, the transport, the health and education and all the other services required for a growing population, and we are obviously not getting them.

But more importantly employers, both large and small, have become torpid – they were never going to be as nimble and agile as Malcolm Turnbull once fantasised, but now they are so risk-averse that the current bout of stagflation – because that is what it is – may become the permanent norm.

While most of the rest of the developed world sees unemployment rates falling and growth taking off after the long slump of the financial crisis of the previous decade, Australian business has seen its profits rise, and that’s it: the potential employers are sitting on their loot, providing just sufficient extra jobs to prevent things from getting worse, although the heavy lifting is being done by the public sector, but not enough to make them any better.

The carrots offered by the government have not worked: just as feared by the cynics (or perhaps we should call them realists) they have been largely squirreled away, leaving the workers surly and bemused as the government insists that if we could only extend more bounty to the corporate sector, everything would change. Repeated overseas experience has shown this to be codswallop.

And of course it is worse than that; while the headline unemployment rate is static, the underemployment rate is going up, the long-term rate is not reducing, youth unemployment, despite the savage conditions imposed on it, is not improving and wages for those in jobs are going nowhere.

Even the governor of the Reserve Bank, the conservative Phillip Lowe, says it is time for the workers to demand a wage rise; but how? The employer groups are firmly opposing any worthwhile increases even in the minimum wage, let alone for those further up the line, on the traditional grounds that wage rises cost jobs. The government apparently agrees and under the current regime the workers have no real power to apply the industrial muscle Lowe suggests.

Conventional wisdom is that unemployment needs to fall below 5 per cent before the job market tightens sufficiently to force the employers to offer more, but it has been a long time since that happened and there is no sign of it on the current horizon.

But don’t worry about that – just concentrate on one million new jobs. That has to be a worthwhile statistic. Well, it’s better than going backwards, which many of us feel we have been in recent years. But hold the celebrations, because the next statistic may not be so welcome. Get ready for at least two million gloating repetitions of Malcolm Turnbull’s questionable triumph – his great justification after well over two undistinguished years in office.

After all the promises, dithering, the backflips and the bullshit, the unemployment rate has not actually fallen. What an achievement.


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