It’s official: The sky is falling.
Europe: Plans to cut national budgets and, in some countries, severe measures designed to prevent defaults on government borrowing, have affected quite a few European Union (EU) countries. There have been protests in Spain, Greece, Italy, France, Portugal, Ireland, the UK, the Netherlands, and Romania. People even took to the streets in Germany, where cuts are not too severe, and growth and unemployment figures are relatively good.
There are many reasons for the numbers of football thugs, postcode gangs and other marginal pests who threaten Britain’s stability, and not least of these is the transgenerational unemployment in towns where traditional industries, such as ship building or coal mining have all but disappeared.
The latest wave of mindless violence in England can only make things worse for those who are rioting. The Global Financial Crisis has not yet begun to play itself out, so this is a silly time for disaffected loons to ensure business owners and investors take their money out of circulation.
Closer to home, Andrew Michelmore - CEO of Chinese government-dominated, Melbourne-based miner MMG – is warning Australia will devolve into a welfare state unless workers start generating a little more enthusiasm for work.
''People can't be bothered moving 25 kilometres to get a job because they will live off social welfare instead, and it's a real worry for me watching Australia have a luxurious time at the benefit of our relationship with China,'' he said.
Mr Michelmore said more seniors and women should be returned to a workforce that was dominated by people with ''airy fairy'', ''idealistic'' and ''altruistic'' attitudes. ''We need to get the grey hairs back into industry and working, we need to get more women involved in work,'' he said.
We hear more and more frequently that there are a gazillion mining jobs going begging in the Pilbara, but none of the people making this claim – while complaining at the same time that Australians are too lazy to take these jobs – have offered me a table listing the number, types and locations of vacancies against the number of true unemployed with the skills available to fill those vacancies.
And how about this comment on Michelmore’s comments:
Couldn't be bothered to move 25k to get a job. What a tool. If the job was 25k away, people would simply drive to get there- why would they need to move?
And another comment:
Take a look at the Victorian De-Sal plant - Don't tell me you couldn't of [sic] flown in a 1000 Chinese engineers each happy to make $40,000 - $50,000 Aust a year, resulting in the thing, needed or not(I won't go into that) being built for a third of the price. We are entering a time where; if you contribute nothing, you will be found out and will suffer. It is my generations time to rid the world of useless hangers-on.
Ouch. Where are these 1,000 engineers who have paid to get a degree yet would rather live on welfare than accept $50,000 a year?
If we can expect rational people to do what is in their own best interests, then it is quite sane for people to look at welfare as one income option. Personally, I can’t for the life of me imagine rational people considering living on long-term welfare and then deciding it is an option.
Hopefully, census data will go some way to revealing the truth about unemployment in Australia, but the results will be some way off. Even then it will take more than a little political will to present the data honestly.
Are we really in danger of going the way of Britain? Is this a case of lots of individual members of the workforce having an attitude of ‘she’ll be right’, or a sense of entitlement? Or are we, at a macro level, designing ourselves into an undesirable corner?
We were once proud that Australia was a relatively classless society but I’m sure if I looked I would find reports that the gap between rich and poor is increasing at an increasing rate.
What scares me more than the laid back Michelmores is the vitriol of some who resent anyone who is not doing as well as them.
Yes, we would all be worse off if some had not incurred student loans, studied hard, worked 120 hour weeks and got somewhere. I do not begrudge them one cent, but I find their judgmental rationalisations unhelpful.
Firstly, they make the mistake of arguing from the particular to the general [If I did it anyone can]. The answer to this is a quote from Joan Robinson:
“The misery of being exploited by capitalists is nothing compared to the misery of not being exploited at all.”
Some people would like a chance to work hard and succeed.
Secondly, I suspect that most of the time what is the ‘right’ thing to do actually brings the most desirable results for everyone.
Welfare in one form or another, and some income redistribution is a moral good. It is also a fair price to pay for living without fear of junkies trying to rob your house at night. It’s the price you pay so that those with less physical or mental opportunities are not asleep and blocking your path when you walk down the street. It’s the price you pay so there is not mindless gang warfare or rioting destroying the assets you have worked so hard for.
Regardless of background or innate abilities, most people face more or less the same basic costs of living.
Thirdly, no one on earth lives in a perfectly free market economy because that would, in practical terms, require anarchy.
Governments interfere in markets.
While it is fair to say that some people are not pulling their weight, rather than resort to simplistic class distinctions, the resenters might lobby for governments to get their act together, resulting in a win-win outcome for both the resenters and the resented.
Marginal developments marginalise
Why the proliferation of McMansions on housing estates with no infrastructure worth spitting at? Estates are rolled out endlessly with no play space, no social infrastructure, and no reliable public transport.
Many of these estates provide entry level homes - for anyone who works and can afford to own and maintain a reliable car. [Of course, the car is not for travelling all the way to work in, it’s only for driving to a train station as part one of the journey.]
As more and more first home buyers default on their mortgages and leave their McMansions, rental tenants are moving in and, in turn, driving even more first home buyers to sell up and move out. The marginalised are shifting to the margins.
Welcome to tomorrow's London.
Costs of relocation
Distance is an issue, but 25 kms is not, as Michelmore would have it, in any way a “distance”. Moving interstate is a distance. Someone who lives, for example, in Sydney and is both willing and able to work in the Pilbara has two options; commute or relocate their family. Relocation is a big ask.
Someone relocating interstate can avoid capital gains tax only for two years if they rent out their existing home.
If they sell up [subject to prices in the housing market] they must still fork over stamp duty when they buy a new house. [In Victoria this is $22,000 for a house worth 500,000.]
Add to this the costs associated with transferring motor registration and driver’s licence, connection fees to utilities and around $6,000 for a removalist.
It is only this year that national registration of health workers has come into effect, but there are some professions where registration is still state based, and some employers demand police checks.
School aged children might need new uniforms or other supplies.
Workers cannot be mobile unless their skills are portable.
At the end of the Vietnam War, we took in at least 85,000 asylum seekers. [Thanks Dina.]
Many were professionals like lawyers or doctors, but their skills were not portable and, for many, retraining was simply not practical.
Some of their solutions included taking factory jobs, buying bakeries [and competing on price], or setting up sweatshops in their kitchen doing piecework for the clothing industry – traditionally one of the worst industries around the globe.
Two Vietnamese men who had a woodworking outlet built me a bespoke flat pack style kitchen I could take to a country house and assemble myself. It wasn’t flash but it was very good, reasonably priced and they added lots of little touches I wasn’t expecting.
Yet others have opened green groceries, or fish stalls.
Today, absorbing these people into the workforce would take a lot longer because the clothing trade has moved offshore, a lot of factories have closed, flat pack furniture is now shipped in from China… that sort of thing.
[BTW, SPC in Mooroopna is the latest casualty of business rationalisation.]
Let’s look at some job options today for the people we once thought of as “unskilled”.
Work in a café or restaurant
food handling certificate type A, plus Barista course or experience
Work in a food processing factory
food handling certificate type B
Kitchen hand in a hospital or aged care facility
food handling certificate type C
White card [OH&S] plus forklift licence
Road Construction Stop Sign Holder
White card [OH&S] plus control construction traffic course
There are TAFE Courses for everything. Want to wash beds and move them around in a hospital? Want to work in a shop?
[I could go on, but I think you get the picture…]
Next… The proper role of government in facilitating the free flow of the business resource ‘labour’.