The Turnbull Government's "strongest year on record for jobs growth" claim is just the opposite, writes Alan Austin.
RECENT ARTICLES in the mainstream media and business journals have hailed the latest jobs figures as “phenomenal”, “historic”, a “golden run”, a “jobs boom” and a “bonanza”.
Minister for Jobs and Innovation Michaelia Cash joined the orgy, heading her self-congratulatory media release, '2017 Strongest year on record for jobs growth'.
As we have come to expect, accurate analysis of the figures reveals these stories to be fake news.
Most reports picked up on the statistical quirk that the Australian Bureau of Statistics’ (ABS) jobs count has increased for 15 months without a downwards dip. While mildly interesting to statisticians, this is quite meaningless as an indicator of economic management. It certainly does not prove what the Turnbull Government and its barrackers want us to believe it proves.
The first fudge here is that it is entirely to be expected that job numbers will rise gradually each month when the population is steadily rising — absent unusual events. Everyone needs food and clothing. So, in a normal economy, when the population rises, so will business activity and jobs. Hence a streak of ten, or 15, or 20 rises should not surprise.
The implied claim that the last 15 months were better than ever is plainly false. The number of jobs generated in the last 15 months was 477,040 — which reduced the jobless rate only marginally from 5.6% to 5.5%.
We only have to go back to 2009-10 when there was a 15-month streak with just the one blip — during the global financial crisis (GFC). Total jobs generated, then, were 373,900, which cut the jobless rate from 5.7% to 5.1%. Two years earlier, in 2007-08, there was another 15-month streak with one blip — in the month before the federal election. Total jobs generated were 437,746, which cut the jobless rate from 4.6% to 4.3%. So 2017 was no bonanza.
Yes, 477,040 jobs sound impressive. Better than Labor? Certainly. But it must be remembered – and this is another fudge – that jobless numbers had risen between 2014 and 2016 to heights not experienced during the Labor years and, in fact, not seen since 1996.
It becomes clear that 2017 was a poor year for the Australian economy overall – and jobs in particular – when the numbers are examined in the global context. As Independent Australia has reported regularly, the whole world is now in a trade, investment and profits boom which really is phenomenal. All well-managed economies are reducing their pools of unemployed remaining from the GFC.
Canada’s jobless rate tumbled from 6.9% to 5.7% through 2017. Estonia’s fell from 7.5% to 5.2%. The Czech Republic’s fell from 5.2% to 3.8%. The average fall in rates across the 35 member countries of the Organisation for Economic Cooperation and Development (OECD) was 0.9%. Australia’s miserable drop of 0.23% was one of the poorest outcomes.
Hence Australia is continuing its steady slide down the international rankings on unemployment — as on virtually all other significant indicators of economic health.
At the time of the 2013 election, Australia ranked seventh among the 35 developed OECD nations on unemployment rates. Countries doing better were South Korea, Switzerland, Norway, Japan, Germany and Mexico. Two years later, after two failed Coalition budgets, Australia ranked 13th — having been overtaken by Iceland, Denmark, the USA, the UK, Israel and – oh, the shame! – New Zealand.
By the end of 2016, Australia had slumped further to 16th, with Hungary, the Netherlands and the Czech Republic moving ahead. Now, after Australia’s so-called jobs boom, ranking fell again through 2017 to 17th, with Estonia zipping past.
Minister Cash boasted on Thursday that, in calendar year 2017, “the economy created 403,100 jobs and three-quarters of these new jobs were full-time”.
No. These are not “new jobs”. Many are merely clawed back from the devastating job losses in the Coalition’s first three years.
The actual record on full-time versus part-time and casual remains dismal. At the time of the 2013 Election, 69.78% of all jobs were full-time. The average through each of Labor’s six years never fell below 70% – despite the worst global downturn in 80 years.
This declined steadily since the election to the January 2017 nadir of 67.74%. It has recovered only marginally to just 68.48% now. Nothing to brag about here.
Other components of the jobs data also confirm that the reality is virtually the opposite of the gushing headlines.
In December, 730,500 people remain unemployed — this makes two monthly increases in a row and 51 consecutive months the total that it has been above 700,000. The last time that happened before the Coalition was elected was in the 1990s.
Monthly hours worked per adult is the best measure of the level of employment any economy is generating, as it takes into account full-time jobs, part-time jobs and population shifts. In December, this fell to 86.60. This brings the average through 2017 to just 85.86 — well below the lowest average in any Labor year.
Youth aged 15-19 have been abandoned by the Coalition. Jobless teens have increased for the second consecutive month. From 133,900 in October, this is now up to 145,200. That’s 5,400 more than one year ago. The youth unemployment rate has risen from 16.95% at the 2013 election to 18.25% in December.
So, when the Minister asserts: “The Turnbull Government has put in place the right policy settings and this is now paying off”, sadly, the opposite is the case.
You can follow Alan Austin on Twitter @AlanAustin001.
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Australia License
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