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Unemployment rises with no plans for growth.

jobsThis week’s unemployment figures should have seen the MSM frothing at the mouth. With over 800,000 Australians looking for work and no sign of any nation building projects to address this appalling number, the MSM is either asleep at the computer, or complicit in trying to conceal what is a failure of leadership.

Tony Abbott has developed a new three word slogan for those who can’t think. It’s ‘Jobs and Growth’ but those of us who can think are wondering what he is doing to make it all happen.

Talking ‘jobs and growth’, as Abbott repeated no less than 6 times in 32 seconds at a press conference last week, is campaigning at its most basic and pointless unless it is supported by hard facts.

So where is the growth plan that will create the jobs?

The strategy apparently, is to lower taxes, reform workplace laws and run smaller government which, as it happens, is the opposite of what they should be doing.

What they should be doing is spending money, and lots of it, on value adding infrastructure. That is what creates jobs and growth. But it seems anything remotely related to spending money is anathema to this government’s ideology.

abetzAt a press conference last week, Employment Minister Eric Abetz described the rise in unemployment for July as “disappointing”. He added, “But nevertheless the figures do indicate that we have to do more for the economy.”

Yes, we know that Senator, but what is it that you are doing?

In response, ACTU president, Ged Kearney said what was obvious to all except, it seems, the government. “Why this government is pursuing this path of cutting, cutting, cutting – cutting skills and programs, cutting support to apprenticeship programs, not actually investing in training up a workforce, is beyond me.”

As fond as Tony Abbott was to quote Rush Limbaugh during the election campaign of 2013 when he said, “No country ever taxed or subsidised its way to prosperity”, he could do better paying attention to Ged Kearney who said “You can’t cut your way to growth.”

This week’s unemployment figures are a disgrace.

The summary ABS Labour Force (seasonally adjusted) estimates for July 2015 are:

  • Employment increased 38,500 (0.3 per cent) with full-time employment increasing by 12,400 and part-time employment rising by 26,100.
  • Unemployment increased 40,100 to 800,700.
  • The official unemployment rate increased by 0.3 points to 6.3 per cent from a revised June 2015 estimate.
  • The participation rate increased by 0.3 points 65.1 per cent. It is still well below its November 2010 peak (recent) of 65.9 per cent.
  • Aggregate monthly hours worked decreased by 3.4 million hours (0.2 per cent).

Underemployment_May_2015There are now 1,838,000 Australians either unemployed (6.3%) or underemployed (8.6%), a total of 14.9% of the available workforce.

Amazingly, Abetz in his press conference referred to the increase in the participation rate as “good news, because more people are wanting to enter the workforce.”

It won’t do them much good if a rise in employment growth is offset by more people registering for work and there are no jobs to find, Eric. Particularly when most of that improvement was in part-time work.

Bill Mitchell gives a comprehensive analysis of the July figures here.

34 comments

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  1. stephentardrew

    Thanks John another fine article. Says all we need to know. Bill Mitchell spot on as usual.

  2. Blinkyewok

    Good article. Abbott isn’t doing anything useful because he is busy practising his new 3 word slogan. How can he win the upcoming election if he can’t remember the slogan.

  3. kerri

    Good article John!
    This Government’s attitude to employment reminds me of a story a Polish co-worker once told me of how his father treated him as a child. The father would say “go to the river and fill this bucket with water and on the way back DO NOT SPILL A DROP,!” He would then beat my colleague just to reinforce the message. The boy would take the bucket. Go to the river. Fill it and carefully walk back making sure not to spill any. When he got back home and showed his father that the bucket was completely full, the father would take the bucket from him and then guve him another beating just to make sure he was careful next time!

    Abetz shows the same abject stupidity and pointless authoritarianism!
    If you can’t find a job! JUST LOOK HARDER,!!!!

  4. Ella Miller

    I am so sickened by the stupidity of our government.
    It appears that you only have to work for one hour to be considered employed.
    My daughter has been trying to find work for one year. No luck yet she has qualifications and experience.
    I would like to know how much money is thrown out the window for companies who are supposed to help the unemployed to find jobs.
    My daughter has NOT been referd by them for one job interview. Yet religiously she attends every 2 weeks. they collect money from the government for each visit. She became so disgusted by the blatant waste that she now refuses to go to them. She uses the internet and religiously sends off applications …some companies do not even have the curtesy of a reply.
    Perhaps if the unemployed were prepared to work for NOTHING they might find a job.
    If this government have their way we will end up like the gypsies horse.
    The gypsy spent a long time trying to teach his horse not to eat. He said indignantly ” just when I taught the damn thing not eat ..it went and dropped dead on me!!!!”

  5. mars08

    Full-time employment increased by 12,400 in July, 2015… I wonder how many Australians were born in that month…

  6. David

    Abetz described the rise in unemployment for July as “disappointing”. He added, “But nevertheless the figures do indicate that we have to do more for the economy.”….that friends is Libspeak for…’ arghhhh we don’t know what the *+#*@ we are doing’, and don’t we know it.
    Thanks John

  7. Möbius Ecko

    “I wonder how many Australians were born in that month…”

    And came in through immigration.

  8. Maureen Walton (@maureen_walton)

    Why are the Little People Worried all is Right we Pollies Have Jobs. With Plenty of money and Perks can not understand what is wrong. LNP are working hard to Sell Australia and they will not let us. They Keep taking their Goverment to Court, but we will do what we want to to please all but the Real People of Australia…

  9. Maureen Walton (@maureen_walton)

    Joe Hockey was on ABC24 Smirking this morning telling one and all How Great the Economy etc is going…

  10. Loz

    This government is a deceitful, lying abomination. They are there to eat at the trough and nothing more.

  11. stuff me

    We know this is the worst govt ever. Herr Abetz is just another light weight in a govt of light weights, and lets not start on Hockey!

  12. Tirrel

    Generally business is contracting except for large monopoly style corporations which operate together like criminal syndicates. The only things growing are property prices, government fines fees and charges, people on benefits and non-whites flooding in – there’s no growth in the areas that actually matter ie manufacturing.

  13. mars08

    “… people on benefits and non-whites flooding in…”

    Fascinating. Proof please…

  14. John Hermann

    In response, ACTU president, Ged Kearney said what was obvious to all except, it seems, the government. “Why this government is pursuing this path of cutting, cutting, cutting – cutting skills and programs, cutting support to apprenticeship programs, not actually investing in training up a workforce, is beyond me.”

    The answer is that the Abbott government is economically illiterate, grossly incompetent, and simply doesn’t know what it is doing. We have a government circus in the control of ignorant clowns and sociopaths who are driven by a combination of neo-liberal ideology and borne-to-rule mentality. Their slogans and electoral spin are not remotely related to reality.

  15. Andreas Bimba

    What the Conservatives and also the Labor Party fail to realise is that ongoing government deficit spending can create employment, expand the economy and generate more tax revenue. The business sector also cannot increase production and investment if wages and consumer demand are static or falling. A growing money supply is needed to harness the labour and talent of the unemployed and the underemployed and to activate dorment economic capacity.

    Such deficit spending doesn’t need to be funded by issuing more treasury bonds but should preferably be funded by ‘printing’ or creating money out of thin air in which case interest payments are not needed nor does this money need to be repaid. If the money is utilised for economic expansion it won’t be inflationary either. Such deficit spending is not black magic and could be thought of as the purchase by the government of shares in the national economy. The current approach of the banks introducing new money into the economy by providing low interest loans for speculative investment in existing properties and the share market actually harms the economy and increases wealth disparity.

    Worthy areas of government expenditure are infrastructure such as public transport, interstate and regional railways, cycle paths, public housing, some roads, redevelopment of cities to reduce energy and water use and renewable energy generation. Low interest loans and other incentives can also be provided to industry and consumers to improve energy, water and raw material efficiency.

    The power of science and technology should be harnessed much more than currently through greater funding of R&D and higher education but with the objective of local industries as well as the wider community being the main beneficiaries. For example research to reduce the fossil fuel needed for steel and cement production and to improve renewable energy production.

    Environmental conservation and health, education and social services are also highly beneficial areas of greater employment. We should also aim to manufacture a significant portion of the materials, appliances and equipment needed for the sustainable economy to meet local demand and for export. Moderate levels of trade protection will however be necessary in most cases as the rest of the world at the same time will be developing these new industries and aggressively selling on world markets.

    A central economic development organisation similar to the Japanese Ministry of Economy, Trade and Industry (METI ) rather than the current destructive neo-liberal Australian Productivity Commission would also greatly increase the chances of success. Singapore is also a good role model for economic development.

    Professor Goran Roos has also developed strategies for economic development for the South Australian Government where pillar industries that work closely with government and private R&D organisations and academia are fostered. Personnel flow freely between business, government, research institutions and academia. These pillar industries aim to eventually attain the critical mass to be world competitive in high value adding, knowledge intensive areas. New businesses and areas of opportunity are constantly spun off the pillar industries and from the research undertaken but develop in a supportive environment. Renewable energy is a suitable pillar industry. California’s Silicon Valley is an example of this cooperative approach.

    Australia’s current neo-liberal preference for low value added commodity export industries will never provide sufficient employment and will increasingly leave us vulnerable to the appalling social costs of global economic recessions. The most profitable portion of these commodity export industries will however still be important as revenue and foreign exchange earners.

    The job guarantee scheme as proposed by MMT economist Bill Mitchell should be implemented to soak up any remaining unemployed.

    All of the above economic development must be within the constraints of reducing national CO2 emissions by 6% p.a. as recommended by Professor James Hansen and more generally of reducing our environmental burden.

  16. Wally

    “The strategy apparently, is to lower taxes, reform workplace laws” I wonder if the business operators who believe the latest attempt to reduce penalty rates will increase their profits have ever taken the time to consider the impact of reducing workers income. When I was raising a young family we rarely ate out and when we did it was usually when I had worked overtime, our normal income was generally spent before it was received to pay the mortgage and living expenses. If the workers affected by the changes spend less money someone else earns less so they cannot afford to spend as much so the downward spiral escalates and when the economy slows down many of the businesses pushing for the changes will suffer because their services are not essential.

  17. Mrs Kensington


    “I wonder how many Australians were born in that month…”

    And came in through immigration.”

    I wonder how many 457 visas were issued?

  18. slorter

    They had a plan it was put together before the election by Hockey when speaking at a conservative think tank in England and was attempted to be implemented in the first budget, it’s called Austerity; growth and jobs will never be visioned with this policy, they know that and when Abbott talks about growth and jobs he means the opposite. When the next financial crisis hits heaven help us, maybe that should be Tony’s new slogan, Or maybe Austerity for the poor and banquets for the rich, that would be another good slogan!

  19. John Kelly

    @Andeas Bimba, a great blueprint for a recovering national economy.

  20. Anomander

    But it seems anything remotely related to spending money is anathema to this government’s ideology.

    On the contrary, I think they are very good at spending money – on themselves.

  21. Pingback: There are now 1,838,000 Australians either unemployed (6.3%) or underemployed (8.6%), a total of 14.9% of the available workforce. Abetz response “good news, because more people are wanting to enter the workforce.” | olddogthoughts

  22. Jennifer Meyer-Smith

    Spot on Andreas,

    I would add to your thoughtful argument that we also need to be providing effective and sufficient financial funding to unemployed and under-employed people (over and above their Newstart for interim periods).

    What recommendations would we provide to this current LNP Government and the Labor Opposition to plan and implement policies and procedures that get the unemployed, under-employed, both mature age and youth alike, into meaningful and nation-building work?

    I advocate that if there are not enough jobs available then much more employment can be promoted by promoting self-employment to EVERY willing and energetic person with an idea, skills, knowledge, experience and/or qualifications in any area of expertise.

    I advocate to both Labor and LNP, as well as other key political parties and forces, that this imperative must be supported by Micro Finance for Micro Businesses (eg Startups, small businesses etc). This Micro Finance in my terms would take the forms of Micro Finance Grants (MFGs) of $10,000+ and Micro Credit Loans (MCLs) of $20,000-30,000. MFGs would be non-repayable while MCLs would be repayable over manageable periods and terms at low interest rates.

    I also emphasise that these MFGs and MCLs would be government backed and NOT administered by the grubby banks because my experience is that they are discriminatory against these very people who need the financial supports the most.

    The point is that they are equitably and promptly available to every such participant above, so that they may transform out of welfare dependency over a reasonable interim period into fully functioning and self-sustaining employed taxpayers, who may then go onto to be employers of other such unemployed and under-employed people, who no longer would be withering away on Newstart.

    It’s a Win-Win for everybody.

  23. Harquebus

    The era of economic growth is over. The key ingredient to economic growth is surplus energy, despite what the modern economic theorists say. Increasing populations combined with depleting fossil fuels was and is always going to result in lower productivity and higher unemployment.

    Our politicians have no plan because, they refuse to face reality and persist with population growth which, only exacerbates the problem. The economy will continue to decay and unemployment will continue to rise. Physical realities trump economic and political ideology every time.

    As for spending lots and lots of money, history has proved over and over that, printing money to boost the economy only ever provides short term relief. In the long run, it always leads to disaster.

    John Kelly. You need to change your thinking mate. If we take your advice, things will only worsen faster.

    The problem is not that there are not enough jobs, the problem is that there are too many people.
    The future will involve an idle class, the unemployed.

  24. Bronte ALLAN

    “Jobs & Growth” (??), sack these inept bloody liberals, then we might get some “jobs & growth”. SACK THE LIBERALS!!

  25. Andreas Bimba

    Jennifer, perhaps the same government organisation that would administer the Job Guarantee Scheme could supervise a suitable government owned bank that could provide the micro finance grants and loans you suggest as well as conventional small business loans. The potential for failure as well as fraud are high so close, long term and competent supervision would be necessary. Starting small and expanding in areas of success would probably be appropriate.

    The big banks have failed in the role of providing loans to small start up businesses and now just concentrate on existing businesses, major projects and real estate.

  26. Wally

    @Jennifer Meyer-Smith if there is not enough demand for existing business to employ more staff where will work come from to keep the new businesses busy and to make them profitable? What you propose could actually do more harm than good, more competition could drive down market prices and result in established companies laying off workers. If the market becomes overly competitive everybody ends up working for nothing and eventually they all go broke.

    How many unemployed people really want to run their own business? I understand some would because they cannot get a job but is running a business or getting a job the main objective of the majority of unemployed people? Being self employed has a multitude of negatives that are very hard to overcome, borrowing money to buy a house, accounting and legal costs to name a few. I know many small business owners who do not have any superannuation or workcover at all so they put themselves in a very precarious situation. A lot of them (some have been in business for decades) would be better off working for a boss, especially when retirement comes around.

    It is hard enough for trades people to keep a small business operating profitably and many earn much less than they would if they were to work for a boss, particularly when you take into consideration the extra hours worked quoting jobs, doing book work, invoicing and paying accounts. I only work part time nowadays but if I was to work 40 hour a week on the tools I would spend at least 60 hours a week working by the time I included travelling, doing book work and quoting work all of which are essential. Without putting in the extra hours a one man show does not generate enough income to survive and my trade electrical contracting is much better paid than most other occupations.

  27. Jennifer Meyer-Smith

    Thanks Wally,

    for your response. I acknowledge your experience and knowledge regarding the practicalities of my proposals.

    Bottom line, the majority of us want to work. Accept that as a given. So, I’m trying to come up with workable, immediate and totally accessible options for making that happen.

    I too, have and still do have, experience in self-employment and I know what it means to be limited by funding.

    So, how do we get over that canyon in order to encourage and to provide meaningful funding that will in turn provide opportunities for innovative and energetic people with real ideas and skills to get their important projects off the ground and running?

    To fail at coming up with those innovative solutions to meet those innovative needs is to fail our society and to deprive our economy of much needed life blood.

    Who’s first to support a proper funding program that meets the needs of unemployed and under-employed people? And don’t tell me that NEIS bullshit! And don’t fob me off to the greedy banks who won’t even open their doors to the disadvantaged!

    If you want solutions to our growing un/under-employment and shrinking economy, support people with ideas and energy with sufficient, immediate and properly accessible government backed funding.

  28. Jennifer Meyer-Smith

    Also Wally,

    the extra bonus is that extra locally grown micro-businesses provide diversity of goods and services to their own particular local communities, which makes the Australian consumer happy for choice and economic reasons and might I also suggest pride in locally grown products. This boosts the economy by providing productive competition. People like homegrown products and services. Take faith that this can be boosted by greater support from government.

  29. Jennifer Meyer-Smith

    Sorry Wally,

    one last point you raised that I wish to address was that my homegrown businesses supported by my MFGs and MCLs will take business away from existing businesses and therefore reduce existing, ongoing employment in those enterprises.

    First, if those businesses can’t stand homegrown competition, then their durability is questionable anyway.

    Second, more importantly, my MFGs and MCLs proposals give local people in every community around Australia the opportunities to conceive, grow and sustain their enterprises which will employ them AND provide employment opportunities for other people. This has got to be great for existing employed people too as they will then have the opportunities to choose between what they have now and what they could go to.

    Growing the pie is only ever a great solution for ALL participants. That’s why we must ensure that the bargaining power of each stakeholder is not undermined in this brave, exciting and growing new paradigm of alternative ways of providing a vibrant society with a vibrant economy.

  30. Wally

    @Jennifer Meyer-Smith people with useful skills have a much better chance of gaining full time employment than the typical unemployed person such as a school leaver or people over 50. According to this http://www.qgso.qld.gov.au/products/tables/unemployed-persons-duration-aus/index.php less than 15% of people remain unemployed for more than a year. So these figures indicate “Bottom line, the majority of us want to work. Accept that as a given.” is correct. Without knowing exactly what type of business you refer to developing I am trying to read between the lines so some of my assumptions may miss the mark.

    What I don’t agree with is “First, if those businesses can’t stand homegrown competition, then their durability is questionable anyway.” for many reasons. A business run from or based from home can undercut larger business, it is possible to service customers needs as well or better and the operator of a small business can make a reasonable living but it will impact on other business to some extent and will not necessarily reduce unemployment. If people don’t leave home to go to work they don’t spend money on fuel/transport, they won’t buy drinks/food for morning tea or lunch and they generally won’t spend money during the working day.

    As well as direct competition to existing business if there was a reasonable portion of the workforce working from home it would have a major impact on many peoples employment. On one hand reduced expenses related to employment means less money is needed to live comfortably but less disposable income impacts on the economy. What we really need is people earning more money so they spend more and as a result more people gain full time employment. It would be a great start if we stopped exporting jobs.

    It seems to me that you have something to sell “Second, more importantly, my MFGs and MCLs proposals give local people in every community around Australia the opportunities to conceive, grow and sustain their enterprises” and your ambition to find a method of financing new business is to benefit your own business. And that assumption makes no difference to me but no matter how good a business opportunity seems to be it is difficult to get bank finance. The banks don’t like losing their money so raising funds even for established business is very difficult and one of the main reasons is that nowadays everything is leased. Companies don’t own the properties they trade from, the vehicle fleet and in many cases the stock so the only value they have is the perceived value of their turnover.

    All that aside the biggest problem I see is people starting a business without having a fundamental understanding of how to run a business, keep tax records and understanding the law in relation to the type of business they intend to run. Before starting my own business (part time initially) I did part time and off campus TAFE studies in basic accounting and bookkeeping and there was still a steep learning curve in the first few years, particularly when it became full time. I might add that I didn’t have the added pressure of finding work or building a reputation etc, I was pressured into starting my own business by people who wanted me to perform work for them on a regular basis.

  31. Harquebus

    “Peak Oil will change the way the world works and our long-held assumptions about the world around us is going to be overturned. Peak oil will render millions of people jobless.”
    “The economist obsess about the energy price and physics tells you about Net energy.”
    https://yuvabharatblog.wordpress.com/2015/08/07/peak-oil-and-what-our-response-should-be/

    “Maduro’s Leftist government has attempted to cover its debts by printing money, a move which has pushed the country towards a state of hyperinflation, according to leading economists.”
    http://www.naturalnews.com/050695_Venezuelan_farmers_socialist_government_food_supply.html

  32. Jennifer Meyer-Smith

    Wally, I don’t dispute the fact that MFG and MCL recipients should also undertake and receive active and effective mentoring in the fundamentals of how to run their businesses efficiently including tax record keeping etc.

    The effective and sufficient funding I’m talking about is to provide much needed infrastructure, equipment, advertising, advertising (repetition intended), rent support, and other business seeding essentials, so that people have sufficient opportunities to get their enterprises up and running.

    I assume your networks were already largely formed so your needs were not so great in getting your skills and products known and wanted. This is the hard part.

  33. Pingback: Unemployment rises with no plans for growth. | THE VIEW FROM MY GARDEN

  34. Pingback: The silenced majority | vanessakairies

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