I can always tell when people are getting anxious about unemployment -
including their own. It's when a journalist thinks they'll be increasing
the sum of human knowledge by adding up the number of redundancies
announced in recent weeks.
The latest list is Qantas 5000, Holden 2900
(by 2017), Toyota 2500 (by 2017), Forge Group 1470, Alcoa 980, Sensis
800, WA hospitals 250 and BHP Billiton Mitsubishi Alliance 230.
That's
more than 14,000, we're told, and doesn't count the expected job loss
among the makers of car parts, which "experts" put at between 25,000 and
50,000. To this you can add declining job opportunities among public
servants - though no one seems to worry much about them.
There are
two tricks in exercises such as this. The first is that although 14,000
or even 64,000 may seem huge numbers, they're not. Most people have no
feel for just how big our economy is. Those figures have to be seen in
the context of a total workforce of 11.5 million people, which grows by
170,000 in an average year, or more that 14,000 a month.
Most
people have no idea how much turnover there is in the jobs market. Every
month tens of thousands of people leave their jobs and a similar or
bigger number take up new jobs. The economy is in a continuous state of
flux.
The second trick is that the media only ever show us the tip
of the iceberg. We're told about only a fraction of the things that
happen. Only a fraction of them are announced to the media, so most of
what happens goes unreported. And among all the things that are
announced, the media select just a few of the juicier items to tell us
about.
The items they select tend to be the bigger and badder ones. News
that a new business has just hired 100 workers may get reported
somewhere - probably in the local rag - but it won't get the trumpeting
Qantas' announcement did.
So we're told about the big job losses
but not the small losses and almost nothing about the job gains, big or
small - even though we know from the official statistics that the gains
usually outnumber the losses.
When people hear news reports about
redundancies at this factory and that, many conclude we must be heading
for recession. This time it ain't that simple. After a record 21 years
since the severe recession of the early 1990s, we're overdue for another
one and, with the economy quite weak at present, it wouldn't be
impossible for us to slide into recession this year.
But the
explanation for the planned job losses we're hearing so much about isn't
a downturn in the economy, it's continuing change in the structure of
the economy - the size of some industries relative to others.
Much of
the pressure for structural change is coming from advances in
technology, particularly the digital revolution. It's this that's
turning the newspaper industry inside out - no one seems to shed many
tears over us - and is in the early stages of cutting a swath through
retailing.
In Qantas' case, it's still making the painful
adjustment to the deregulation of airlines initiated by Jimmy Carter in
the 1970s, combined with management incompetence and union
intransigence.
But the biggest source of structural change is the
resources boom and the likely permanent rise in the dollar it has
brought about. People tell you it's all behind us, but when the mining
industry's share of the economy doubles to 10 per cent in the space of a
decade, the adjustment this imposes on the rest of the economy is
profound and protracted.
Clearly, these forces for structural change are
beyond the control of any federal government, Labor or Coalition. The
truth so many people find so hard to accept is that there isn't a lot we
can do about them except ride them out.
In its impotence, the
Abbott government is claiming its plans to remove the mining and carbon
taxes will be a great help. Only the one-eyed would believe that. Labor
has sunk to the depths of attacking the government for its failure to
protect Australian jobs and demands to see its "jobs plan". What's
Labor's jobs plan? Maintain the handouts to crumbling industries.
It's
seeking to exploit the fears of people who are uncertain about where
it's all going to end. Well, last week Dr David Gruen, of Treasury,
published projections of the various industries' shares of total
employment in 16 years' time, 2030.
I must warn you these figures
come with zero guarantee. Just because you're smart enough to turn the
handle of an incomprehensible econometric model doesn't mean you know
any more about what the future holds than the rest of us.
Surprisingly,
the projections suggest manufacturing's share of total employment will
decline by only a further 1 percentage point. Similar declines are
projected in transport and warehousing, construction and (thankfully)
financial services. The biggest relative employment decline would be in
wholesale and retail trade.
Utilities, media and
telecommunications, and, surprisingly, mining are projected to
experience minor declines in their shares of total employment.
Agriculture's share may rise by a percentage point, while that of
education and health may rise by more than 1.5 points, and professional
and administrative services by almost 3 percentage points.
We won't all
be dead.
