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(Image courtesy http://www.enlenterprises.com)

Since the mid-1970s, the rising dominance of what we now call neo-liberalism saw the Fraser government deliberately abandon a 30 year commitment to full employment. Now the Centre for Full Employment and Equity (CofFEE) has developed a sustainable path to full employment, which it calls the Job Guarantee program. David Hale reports.

THE JOB GUARANTEE. This is not full employment that may still mean an unemployment rate of 2-5 per cent. This means a job for everyone. The introduction of a Job Guarantee would not only reduce poverty because the unemployed are well represented in poverty numbers, it would also see an end to the bickering and ideological wars over unemployment benefits, Work for the Dole and stereotypes about the lazy unemployed.

The private sector never has and never will be able to provide employment to everyone. It is unlikely to hire those it is most adverse to — the long-term unemployed, the disabled worker, and the mature-aged worker. The Job Guarantee is the way forward.

A high youth unemployment rate in a suburb of Sydney could disappear within months. A rural town neglected by business could see everyone get a job. Suburbs where just about everyone in the street is unemployed could see nearly everyone in that street gainfully employed. 

A household that had intergenerational poverty could now have a family member gain employment for the first time. A Job Guarantee could be offered in varying circumstances, such as: 

  • A global financial crisis.
  • A fall in the iron ore price, partly brought on by companies like BHP driving down the price per tonne.
  • A fall in economic activity here or abroad.

The Job Guarantee is a government program that could be rolled out and paid for — in all of these circumstances.

Keynote presentation to the Jobs Australia Conference, Melbourne, August 28, 2014 by Professor Bill Mitchell from CofFEE
 
So what would such a program cost? The Centre for Full Employment and Equity estimates it would cost about $23.3 billion a year. This is out of government revenues of over $330 billion a year. The Australian government already spends about $9 billion a year on unemployment benefits and over a billion a year on Job Services Australia. The Federal government would get around 20-30 per cent of it back via income taxes each year. State governments could help pay for it. They generate over $50 billion a year just in GST revenue which would more than pay for the scheme. Even the private sector could contribute funds.
 

Public works programs are not just make believe. They provided millions with employment during the Great Depression in the United States. The National Rural Employment Guarantee Act in India provided those in rural areas with employment. It would see poverty significantly reduced. It would see more money being spent in the economy and more GST revenue for the states. The Job Guarantee is such a good idea, the states should be pushing for it. It would see entire families change their situation almost overnight. It would see entire suburbs marred in poverty become prosperous.

David Hale is a member of the Queensland Greens Economics & Energy Policy Working Group. These are his views and are not necessarily those of the QLD Greens.

You can follow David on Twitter @David_12N.

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