With new stay-at-home orders covering many parts of the province, Ontarians are settling in for a month (at least) of daunting isolation. Restrictions are also being tightened in other provinces to slow the spread of COVID-19, until vaccines can turn the tide of the pandemic.
Despite accelerating infection and overflowing hospitals, many oppose the new restrictions on grounds that their economic costs are just too high. Business lobbyists grumble that health rules on retailers, airlines, cinemas, ski resorts, gyms, and more are onerous and unfair. Each sector invokes comparisons to others which supposedly get off easier. The common thread in their resistance is an assumption that strong health restrictions are deeply damaging the economy.
As the pandemic rolls on, however, it is increasingly clear that the best way to protect the economy is to stop COVID. Yes: lockdowns reduce economic activity and employment. But not locking down, letting the virus run rampant, causes more economic damage — on top of the toll in lives and suffering. Anyone concerned about the economy should be pleading for fast, powerful lockdowns, not demanding a return to business-as-usual.
The correlation between controlling contagion and economic recovery is clear across Canadian provinces: those with fewer COVID cases have achieved the strongest employment results since the pandemic hit. It’s not often that New Brunswick leads the nation in employment growth — but it did last year. Its near-elimination of the virus was the obvious reason.
In this context, the protestations of premiers Doug Ford and Jason Kenney that fighting COVID must be “balanced” against the interests of business were always self-defeating. Even if they were motivated solely by desire to protect business, their top priority should have been stopping COVID. The faster and harder that battle was waged, the better business fared.
The correlation between COVID suppression and economic performance is also obvious in international data. Several countries moved fast with severe but temporary restrictions on mobility and business; and they are now harvesting the fruits of their foresight. COVID-slaying nations like Australia, China, New Zealand, South Korea and Taiwan are already enjoying powerful and sustained economic recoveries. Their economies (forecast to grow by five to eight per cent this year) are racing far ahead of those still lurching from one wave of infection to the next.
No one escaped the economic fallout of the pandemic. But after powerful action to suppress contagion, these countries are now recovering strongly and predictably. Elsewhere, the economic outlook is far less certain. In Canada, for example, our hopeful summertime recovery is already disintegrating: employment is now falling again. America, Britain, and other places where COVID suppression failed miserably are faring even worse.
A particularly powerful illustration of the link between public health and economic recovery is provided by the experience of Victoria, the second largest state in Australia. After initial success limiting COVID-19’s spread, a second wave took hold in Melbourne (Victoria’s capital), infecting 600 people per day by early August. The state government ordered a strict lockdown, more severe than anything yet experienced in Canada: overnight curfew, closure of most workplaces, and strict bans on social gatherings and travel.
The government was pilloried for its response — facing sustained attacks from its federal counterpart, business groups, and conservative commentators, all lamenting Victoria’s descent into “dictatorship.” Yet after 111 long days, Victoria achieved something almost unheard of: mass community spread was stopped, and new cases fell to zero by late October. Now the state economy is blossoming: employment rebounded 2.2 per cent in November alone, retail sales grew 22 per cent the same month, and Victorians are flocking back to restaurants, pubs, and malls. All those CEOs whining about Canada’s late and half-hearted restrictions must be drooling with envy.
Leaders like Kenney and Ford were unduly influenced by short-sighted concern with business profits. Their reticence has created needless harm, for both public health and the economy. If we’d moved faster and more powerfully to limit contagion, business would already be better off.
The economy is made up of human beings who work, produce, and consume. There’s no tradeoff between the economy and the health of those same human beings. The sooner we recognize they are one and the same, the sooner we can finally get serious about winning this battle.
Jim Stanford, director of the Centre for Future Work in Vancouver, is a freelance contributing columnist for the Star. Follow him on Twitter: @jimbostanford
A year-end review of the dramatic changes in Australia’s labour market in 2020 has confirmed that the worst economic impacts of the Covid-19 pandemic were felt by Australians in relatively low-paid, insecure jobs.
Key Findings:
Workers in casual jobs lost employment at a rate 8 times faster than those in permanent positions
Part-time workers suffered job losses 3 times worse than full-time workers
Young workers, women, and workers who do not work in offices also suffered disproportionate job losses during the initial shutdowns – and continue to experience much worse employment conditions
Worse yet, the report shows the rebound in employment that began in May has seen a historic surge in insecure jobs – which account for the vast majority of new jobs created since the economy began re-opening
“It is painfully ironic that the worst impacts of the pandemic were felt by those who could least afford to lose their work and income,” said Dr Jim Stanford, Director of the Centre for Future Work, and co-author of the report.
“Both on the way down, and on the way back up, this recession has reinforced the dominance of insecure work in Australia’s labour market.
“Precarious work strategies explain why the effects of the pandemic were so painfully unequal, and this new surge in insecure work makes Australians even more vulnerable to such shocks in the future.
“Covid-19 had a terrible impact on both the quantity and quality of work in 2020. Because Australia has been relatively successful in controlling the virus, the labour market could improve significantly in 2021, however, the rapid expansion of insecure work poses a major challenge to the stability and prosperity of Australian households,” Dr Stanford said.
Other findings of the report include:
Since May, over 400,000 casual jobs have been created (2200 per day, on average), accounting for over 60% of all new waged positions since the recovery started. That is the largest surge in casual employment in Australia’s history – contradicting business and government claims that uncertainty about casual employment rules are holding back hiring.
Workers over 35 years of age have regained all of the jobs lost in the pandemic, and then some. All remaining job losses are concentrated among workers under 35.
Office-based occupations (professionals, clerical workers, and most managers) have also regained pre-pandemic employment levels. But other occupations (especially community and personal services, sales workers, and labourers) continue to suffer major employment losses.
New labour laws proposed by the Commonwealth government would accelerate the surge in insecure work: liberalising the use of casual labour by employers, and allowing them to treat permanent part-time workers more like casuals.
However, the pandemic also highlighted stark fissures in Australia’s labour market. The employment and income impacts of the pandemic were starkly unequal, across different groups of workers. This report highlights several ways in which the pandemic has increased inequality in Australia, and reinforced the dominance of insecure work in the overall labour market.
In this extended commentary, Senior Economist Alison Pennington explains the main components of the IR Omnibus Bill, assesses their impacts on workers’ wages and labour protections, and offers some strategic analysis on how labour advocates can work towards addressing insecure work.
Scott Morrison’s Industrial Relations Laws Are a Kick in the Teeth for Australian Workers
By Alison Pennington
The Morrison government has proposed sweeping changes to Australian labor laws intended to cut wages, entrench precarious work, and cripple unions. The proposed changes would sweep away the remnants of collective bargaining and hand dictatorial power to bosses.
Just a few months ago, Australia’s Coalition government was singing the tune of compromise and cooperation with unions. Now they’ve thrown away the songbook and taken the gloves off. Scott Morrison is giving Australian workers and unions class war — just in time for Christmas.
Thanks to pandemic stimulus spending, 2020 was already a Christmas-bonus year for big business. With company profits up nearly 19 percent since 2019, they have already benefited to the tune of billions.
But it’s never enough. So, industrial relations minister Christian Porter has introduced the Industrial Relations (IR) Omnibus bill. It’s a withering pro-business offensive aimed at slashing wages and resetting work conditions to boost profitability in the long term.
The core of Porter and Morrison’s plan will grant employers the power to expand insecure work freely and to hijack enterprise bargaining. If it goes ahead, it will inflict a double wound on the working class, by degrading the Awards system (that sets minimum wages and conditions across industries) and by weakening what little remains of unions’ collective bargaining power.
Never Let a Crisis Go to Waste
The idea that workers’ economic security should be subordinated to business demands is archaic. It’s a form of employment that unions have fought bitterly since the nineteenth century, winning historic victories to curtail piece-work or at-home work, and to end the dictatorial control of gang masters over who did and did not work, and under what conditions.
Some fruits of that multigenerational battle still remain embedded in today’s standard employment relationship, which guarantees rights to ongoing work and basic entitlements. However, neoliberalism’s decades-long onslaught has weakened unions. As a result, all of these abuses have returned, sometimes in new packaging — as is the case with the “gig economy.”
An Uber Eats part-time worker. (Jack Taylor / Getty Images)
Today, 2.6 million Australian workers are defined as “casual.” This means that one in every four workers has no right to ongoing work, and no basic holiday or sick leave entitlements.
This is justified by the claim that casual workers receive “casual loadings” (extra pay) to compensate for forfeited conditions. But this is a myth. Far from being compensated for the value of lost entitlements, most casuals are in fact much worse off.
One third of all casuals receive no loadings at all, and most casuals are not paid more than permanent workers in the same jobs. In industries with high casual density, the premium is around 4-5 percent — far from the oft-cited figure of 25 percent.
Bosses love to praise the virtues of “flexibility,” claiming that casuals don’t want permanent work. But this mantra is also a lie — half of all casuals have worked regular shifts for one year or more.
Rather than simply allowing firms to employ a few extra workers on a seasonal basis, casual work is increasingly the way that Australian businesses meet their medium- and long-term labor needs. And, in the post-COVID era, they increasingly see casual labor as the foundation for boosting profits.
Accelerated Precarity
Two recent major court cases found that businesses which employ casuals on regular, stable, and predictable schedules are liable to pay leave entitlements. It was estimated that this would cost employers over $39 billion.
In response, business lobbyists unleashed campaigns to “resolve the definition issue” so as to avoid court-ordered repayments. This — as well as the growing importance of casual work to profits — explains why Morrison and Porter have made entrenching casual work the cornerstone of their IR Omnibus bill.
They want to define casual work in the broadest possible terms. Any job deemed casual by the employer will be, legally, a casual job. This means your job can look like a permanent job and smell like a permanent job — but employers will still be able to legally engage you as a casual and strip your legal entitlements at will. This is a body blow to the present system of legal protections.
The pandemic has highlightedthe dangersof insecure work. But for the Coalition and their business allies, it changed nothing. Even while frontline, often insecure workers risked their lives, the government was keen to increase the number of workers trapped in precarious, low-wage jobs.
First, the Coalition excluded over one million casuals from the JobKeeper wage subsidy. Then, they reduced the Coronavirus Supplement, hoping to force the unemployed and vulnerable into insecure work while making it cheaper for businesses to rehire workers. Next, Liberal treasurer Josh Frydenberg announced JobMaker — a payment that directly subsidizes new, insecure youth jobs that will allow bosses to sack existing, more expensive and older workers.
The JobKeeper subsidy is set to end in March, exactly when Porter’s sharpened wage-cutting tools are due to kick in. Employers will go on the offensive, recouping lost public subsidies by taking even more from their workers.
The bill’s supposed sweetener is a measure that will require employers to offer casuals permanent work if they have been employed for twelve months, with six months of continuous regular hours scheduling. Not only will it be easy for employers to vary hours and schedules to avoid meeting that high benchmark, they will also be allowed to refuse to make an offer on so-called “reasonable grounds.”
The government was sure to define “reasonable” in incredibly broad terms and to deny workers the right to appeal a decision through the Fair Work Commission (FWC). Got a problem with your employer’s decision? The Federal Court will hear your case — but only if you have a spare ten or twenty thousand dollars lying around.
Deregulating Permanent Work
Accelerating the growth of insecure work is also about cannibalizing protections for the permanent workforce, by making permanent jobs resemble casual ones. New so-called “part-time flexi” reforms will let bosses employ permanent part-time workers as though they were casuals.
Only sixteen hours will have to be paid according to normal permanent rates and entitlements, while an additional twenty-two hours (comprising a total work week of up to thirty-eight hours) will be free of overtime loading. With the stroke of a pen, this threatens to dissolve hard-won rights that deliver predictable and stable schedules for permanent part-time workers.
With a flexible twenty-two hours of ordinary-time labor up for grabs, employers will be able to work these “part-time” workers like full-timers on a regular basis — as supervisors and managers, for example. But they won’t have the security of regular hours or receive overtime compensation for being at the employer’s beck-and-call. The flexibility will be blissful — for bosses.
For all the Coalition rhetoric about “job creation,” this wholesale deregulation of working hours really means that bosses will be able to cheaply increase hours for existing workers in line with fluctuations in demand. That will free them from having to hire more people. It’s galling that the government would present the creation of a “part-time flexi” employment category as a solution to record-high and growing underemployment.
There’s no shortage of glossy marketing. For example, low-wage work will be expanded under the guise of “roads to permanency.” But when you cut through the spin, the Coalition’s agenda is to reduce the incomes of millions and to deny millions more decent jobs. During a recession, with labor-force utilization already low, they’re arming employers with powerful weapons to cut wages and conditions in the jobs that remain. These moves will generalize despair and desperation across the entire workforce.
Hijacking Collective Bargaining
Worst of all, the IR Omnibus bill contains a trifecta of changes to the laws governing enterprise agreement (EA) making. These changes will allow businesses to draw up workplace agreements by themselves more easily — that is, without a union. They will be allowed to undercut the minimum rates and conditions outlined in industry Awards with these nonunion agreements. Additional changes will let employers lock in wages stipulated by an enterprise agreement for eight years at a time.
This is nothing less than a hijacking of what’s left of collective bargaining. In fact, handing employers unilateral power over enterprise agreement wage-setting was the cornerstone of former Liberal PM John Howard’s infamous WorkChoices legislation.
The Coalition’s plan will allow employers to bypass the Better Off Overall Test (BOOT) for two years. As it is, the BOOT ensures that new agreements do not leave workers worse off than under minimum Award conditions. The suspension of the BOOT coincides with new measures that will weaken scrutiny of subpar nonunion agreements by the FWC, unions, and employees.
The move has been taken straight from the wish list of business lobbyists. It will open a floodgate of nonunion below-Award agreements that will permanently damage living standards.
There’s a precedent for this. Under Howard’s WorkChoices, the “No Disadvantage Test” was abolished and unions were denied the right to contest agreements, leading to an explosion of nonunion agreements. Between 2004 and 2009, the proportion of nonunion agreements approved in the private sector rose from 20 to 60 percent.
After 2009, when WorkChoices was partly rolled back, the number of dodgy agreements dramatically declined to pre-Howard levels. Why? Because as part of the Fair Work Act, the Better Off Overall Test was introduced.
Even so, the WorkChoices-era surge in nonunion, low-wage agreements had a lasting, negative impact on wage growth. “Zombie Enterprise Agreements” persisted for years. For example, Merivale, a Sydney hospitality empire, paid over three thousand staff up to 20 percent below Award wages on an expired nonunion EA set in 2007 for over ten years.
This is possible because EAs live on, sometimes for years, until they’re replaced or terminated — usually on request by unionized employees. Today, tens of thousands of workers are still languishing on Howard-era below-Award enterprise agreements.
Unfair Work
The FWC has the power to change and approve agreements so long as employees remain better off overall, compared to the relevant Award. On top of this, there already exists a relatively untested provision whereby the FWC may approve agreements with below-Award conditions in so-called “exceptional circumstances,” provided they meet the overall public interest.
A couple who both lost their jobs recently watch local news in their apartment. (John Moore / Getty Images)
The IR Omnibus bill will weaponize the “public interest test” governing this power, enabling business to push even further. The Coalition’s hand-picked business leaders in the FWC will surely oblige.
Australian business and their allies in the Coalition have dedicated enormous resources to crushing what remains of collective bargaining. Their goal is to corrode the infrastructure of the labor movement’s past victories.
This is why the Coalition also wants to introduce eight-year agreements on new projects valued at over $500 million or $250 million, if the project is of national significance. Existing laws mean that employers can only seek FWC approval on agreements for new projects (called “greenfields” agreements) after six months of bargaining with the relevant union.
However, if the BOOT is scrapped, employers could feasibly draw up greenfields agreements undercutting Award conditions for up to eight years, circumventing unions and simply hiring a new workforce under the new agreement.
Since Australia’s draconian anti-union laws prohibit industrial action at any time outside an EA bargaining period, eight-year agreements give employers the power to block strikes as well as to cut wages. There is also a political logic to it: it’s a cost and risk reduction strategy, guarding against any future joint campaigns that link unions with other elements of civil society. For example, unions will face crippling fines for striking at any time during the eight-year period to support campaigns against inappropriate development, or against new mining projects.
As if this weren’t enough, the Coalition is bolstering the power of the courts and the anti-union Australian Building and Construction Commission to inflict millions of dollars’ worth of fines on unions for activities which are entirely normal and legal in other democratic countries.
It couldn’t be clearer. Just as the Coalition’s 2020 budget gifted business with billions in subsidies, tax cuts, and other handouts, this, too, is a vast gift to capital, purchased at our expense.
A Common Enemy
The union movement has a good chance of stopping the BOOT changes in the Senate, where minor parties hold the balance of power. But everything else is up for grabs thanks to the Coalition’s Christmas “spirit of compromise.”
Insecure work is the enemy of unionization. Workers living in permanent precarity and intermittent poverty are less likely to join unions. Only 8 percent of union members are casuals. And when the bargaining power of unions declines, all workers suffer.
By expanding casual work, the IR Omnibus bill will strike the harshest and most comprehensive blow to wages and living standards in many years, both now and in the future. This is why the union movement must resist insecure work everywhere it rears its head.
We need unions that are willing to build power among existing, permanent workers who are in a better position to endure the risks of industrial action. It’s still harder and more expensive to sack permanent, more senior workers. But without a fight back, this will change too — the growth of precarity means that even secure workers are on increasingly unsteady ground.
Permanent conversion rights for casuals don’t work without workplace union power. Unions must unleash aggressive collective bargaining campaigns aimed at bringing all workers under the same agreement “roof” and into permanent work. This would have to include bringing contracted-out and labor-hire work back in-house.
Since the most precarious sectors of the workforce have lower union power and no access to collective bargaining, we also need a united union movement willing to mobilize all of our 1.5 million members, linking the pockets of union power in the private sector (including construction, ports, and logistics) to our largest public sector bases in health care, education, and social services. We must weave good jobs back into the fabric of Australia’s social contract — this means fighting for jobs that offer rights to ongoing employment and basic entitlements like holiday pay, sick leave, and superannuation.
Most importantly, reviving unions after years of decline will require determined efforts to rebuild a modern workers’ movement with deep support and social roots. This will mean working with climate action, anti-poverty, welfare rights, and other social justice and community organizations.
Unions and their allies have to push for working-class politics at every level of government, from local to federal, and build a broad coalition that will put decent jobs and economic democracy at the center of a progressive vision for Australia.
Public institutions like Medicare, public education, TAFEs, superannuation, and corporate taxation are widely popular. Australians broadly agree with the need to rebuild a domestic manufacturing sector and to refund the arts and tertiary education. The union movement could be the vehicle that makes these aspirations real.
This project can be popular. This year, the profit-hungry zealots of Australian business and the Coalition’s conservative apparatchiks told us that “we must learn to live with the virus.” But Australians overwhelmingly disagreed, and instead supported the subordination of short-term business interests to the public good. Despite a well-funded conservative campaign, large majorities overwhelmingly supported shutting down the economy to save lives.
Now we must protect ourselves against another virus that would irreparably damage the quality of workers’ lives in the name of higher corporate profits. That virus is insecure work. It’s lived among us too long — it’s high time we shut it down.
Released following the UN Climate Ambition Summit (12 Dec), which highlighted the need for Australia to accelerate the phase-out of fossil fuels, the report finds that delaying climate policy cannot protect the quantity or quality of fossil fuel jobs, which will inevitably decline as the global energy system shifts quickly to renewables. To best protect these workers and communities, pro-active transition planning must start now.
Key findings of the report include:
With strong commitments to alternative employment creation (including, but not limited to, jobs in renewable energy projects), a transition away from fossil fuels can occur without involuntary layoffs or severe disruption to communities.
Direct employment in fossil fuel industries is relatively small, just 1% of total Australian employment, and in any single year the overall economy produces twice as many new jobs, as are employed in total in fossil fuel industries.
Health care and social services employs 13 times as many people as fossil fuels. At current rates, it would take just two years of new work in health care alone to fully offset all current jobs in fossil fuel industries.
Fossil fuel jobs are especially important in some communities, but the number of such communities is small. In just 11 out of 350 Australian communities do fossil fuel jobs make up over 5% of local employment. Strong, focused supports, paid for by the country as a whole, can help those communities adapt to the coming change.
Examples of previous transitions in other countries (including Germany, Canada, and Spain) confirm that fossil fuel sectors can be phased out with no involuntary redundancies.
Dr Jim Stanford, Economist and Director of the Centre for Future Work, and author of the report, highlighted the benefits of long-term planning, an announced timetable, and pro-active transition supports (including supported early retirement, job mobility across sites as fossil fuels phase out, and ambitious regional development and diversification efforts) to avoiding involuntary redundancies or economic damage to regional communities.
“In fact if managed well, most people currently employed in the fossil fuel industry will not even need to find alternative work: as the industry gradually winds down, most will transition directly from fossil fuel work into retirement, or other forms of voluntary severance.”
The report was commissioned by HESTA, the industry super fund in the health care sector, and a leader in adjusting its investment portfolio to be consistent with the movement toward net-zero emissions. Mary Delahunty, HESTA’s Head of Impact, noted that “Investment back into a nation’s ‘caring economy’ – health, education and social services – is the most effective way to stimulate economic activity and creates higher-quality, more sustainable, long-term growth.”
“This report demonstrates that with appropriate investment this can go even further, supporting a manageable, sustainable phase-out of fossil fuel jobs,” Delahuunty added.
“HESTA was the first major Australian super fund to commit to a total portfolio ‘net zero by 2050’ emissions target as part of our ambitious Climate Change Transition Plan. Supporting a planned transition is crucial to us achieving these ambitious goals and to protecting the long-term value of our members’ investments.”
In this commentary, which originally appeared in The Age, Centre for Future Work Senior Economist Alison Pennington discusses what the pandemic reveals about Australia’s high levels of insecure work, new work-from-home risks, and how rebuilding more secure labour markets will be critical to creating more good jobs in our post-COVID recovery.
The report, by the Centre for Future Work, finds that for every 10 direct jobs in state-funded public services, another 4.5 jobs are supported in the QLD private sector. This means that these public services support a total of some 480,000 public and private sector jobs across Queensland. Cuts to public services and staffing would impact private sector jobs and incomes, deepening the recession.
Key Findings:
Some 480,000 positions are supported, directly and indirectly, by the provision of state-funded public services in Queensland.
This includes 331,000 direct public sector jobs, as well as over 150,000 more positions in the private sector that depend on the economic stimulus provided by public sector work.
For every 10 direct jobs in the state-funded public service, another 4.5 jobs are supported in the private sector.
Regional and remote Queensland is the most reliant on state public sector workers – both for the services they provide, and as a source of high-quality employment for local residents. State public sector workers account for almost 12% of total employment in remote and very remote regions of QLD.
The report simulates two potential scenarios of fiscal austerity in Queensland. It finds that fiscal austerity (imposed via cuts to public service staffing and wages) would cause substantial harm to Queensland’s economy: including cumulative losses (over three years) of $9-$16 billion in state GSP, and the loss of 20-35,000 person-years of employment in the private sector.
“In this unprecedented time, the maintenance of public services is surely a more urgent priority than cutting government spending in pursuit of some illusory fiscal target,” said Dan Nahum, Economist at the Centre for Future Work and author of the report.
“By cutting employment and incomes for public sector workers (and the private sector industries which depend on public services for their own markets), misplaced austerity would undermine economic recovery and reduce GDP.
“A more constructive and effective response to the COVID crisis is to expand the economic and social footprint of government, including state governments – not shrink it.
“Attacking public sector employment and compensation, just at the time Queenslanders need more public services, not less, would be a major policy mistake.”
New economic research shows up to 12,000 community service jobs are at risk due to the Federal Government’s failure to confirm whether federal funding for community service organisations will be maintained.
The new report released today by the Australia Institute’s Centre for Future Work demonstrates the economic importance of Commonwealth pay-equity funding at a time when these community services are critical to Australia’s pandemic-damaged economy.
Key Findings:
The Federal Government is yet to confirm whether it will continue $576.5 million in supplemental funding for federally-supported community services, currently set to expire in the current (2020-21) financial year.
This special funding was part of the Commonwealth government’s legislated 9-year timetable to phase in pay equity wage adjustments in community services.
If this funding is not renewed (either by incorporation into a higher level of core funding for affected organisations, or through the extension of explicit pay equity supplements), the resulting funding shortfall will undermine and reverse the progress that has been made toward pay equity since the 2012 pay equity order.
The loss of federal pay equity supplements would inevitably produce some combination of staffing cuts and wage cuts, as organisations respond to such a significant loss of funding.
“If experienced fully through staff cuts, the end of federal supplements would result in the loss of close to 12,000 jobs in federally-supported community organisations,” said Dr. Jim Stanford, director of the Australia Institute’s Centre for Future Work.
“Alternatively, if the brunt of the funding cut is experienced through effective wage reductions it would reduce annual incomes for federally-funded community service workers by as much as $15,000 for full-time staff.
“To put up to 12,000 community service jobs at risk, or force community service workers to take a $15,000 a year pay cut in the middle of global pandemic and an economic recession is both heartless and economically self-destructive,” Dr. Stanford said.
The Centre for Future Work report also found that the broad health and social services sector (which includes most of these community service organisations) has reduced the gender pay gap by more than any other industry in the years since the pay equity reform was announced.
Those past gains will be undermined and reversed unless federal funding consistent with new pay equity norms is quickly confirmed.
To mark National TAFE Day and the release of new research by the Centre for Future Work on the economic and social benefits of the TAFE system, The Australia Institute hosted a timely discussion on how the TAFE system can drive a COVID-era skills and jobs recovery with ACTU President Michele O’Neil, Correna Haythorpe, federal president of the Australian Education Union, and Alison Pennington, Senior Economist at the Centre for Future Work.
The webinar was presented as part of the Australia Institute’s widely acclaimed Economics of a Pandemic webinar series and explored why the TAFE system has been in turmoil, the historic role it has played generating a more skilled workforce and productive economy, and how we can fix it.
The report findings contrast sharply with the common concern that robots and other forms of automation will threaten future job security for Australian workers.
Major findings include:
Business investment in new machinery (including robots) is weaker than at any point in Australia’s post-war history.
Business spending on new research and technology has also been falling in Australia, and now ranks well behind the average of other industrial countries (and even some emerging economies, like China).
The average amount of machinery and equipment used by the typical Australian worker has been declining since 2014, and has since fallen by 6%.
Because of less automation and innovation, average productivity in Australia’s economy has also been declining for three straight years – also the weakest performance in Australia’s post-war history.
“Australian businesses are not investing nearly enough in new technology,” said Dr Jim Stanford, Economist and Director of the Centre for Future Work.
“This lack of business investment in new technology does not mean that Australian jobs are somehow safer. To the contrary, the failure of business investment means that even more jobs will be located in low-productivity, low-tech, low-wage industries – with terrible implications for wages and job quality.
“Business leaders love to complain that Australia’s productivity problems are due to red tape, taxes, and unions. The evidence is clear that their own failure to invest in new capital and new technology explains the stagnation in productivity. Instead of blaming others for this outcome, business leaders need to look in the mirror.”
