Originally published in The Mercury, Monday 28 September 2020
By Noel Pearson
“Men occasionally stumble over the truth, but most of them pick themselves up and hurry off as if nothing had happened.” -Winston Churchill
On Wednesday the Tasmanian Parliament confronted a great truth. The truth is that while the private market creates many, many jobs – it does not and will not create enough jobs for all Australians.
To the long-term unemployed this is self-evident.
But to the political class, who occasionally stumble on it, they are quick to hurry off as if nothing has happened.
This truth which is so evident to ordinary citizens is denied by governments and ignored by the Reserve Bank of Australia whose charter it is to manage the economy to maintain full employment.
Instead of facing the truth that long-term unemployment has become a fixture in our economy, some politicians would divide Australia into “lifters” and “leaners”. A $12 billion Job Network industry churns legions of the unemployed through mutual obligation procedures pretending to place jobseekers into non-existent jobs.
Johannes Leak’s cartoon in The Australian on Monday tells the story of a thousand words, with Treasurer Frydenberg flicking through his tennis magazine insouciantly answering the unemployed man’s question about how mutual obligation is supposed to work: “We pretend there’s loads of jobs out there and you pretend to apply for them.”
On Wednesday evening, Cassy O’Connor, Leader of the Greens, introduced a motion in the Lower House imploring the Gutwein Government to investigate the concept of a Job Guarantee for Tasmania.
Her speech was eloquent, informed and one for the times.
She pointed to the need for Australia to return to a policy of full employment which officially ended in 1975 after being introduced by Prime Minister John Curtin in 1945.
She highlighted the intergenerational poverty and disadvantage resulting from the disempowerment and isolation of too many people who are denied meaningful work.
She spoke about the worrying increase in long-term unemployment and underemployment, erosion of worker’s rights and ongoing wage stagnation.
And she spoke about the disproportionate impact of this malaise on our young people.
Although I hail from the opposite end of Australia, on Cape York Peninsula, everything Cassy O’Connor said rang true for me as it would have for many unemployed Tasmanians.
For over fifty years my people have been denied entry-level work opportunities and a place in the real economy.
After the equal wages case in the 1970’s Aboriginal workers were laid off in the thousands the transferred onto the welfare rolls.
Ever since then the Government has been telling us the private market will deliver the jobs if we just take responsibility.
I am the first to agree to the need for responsibility. My first book was entitled “Our Right to Take Responsibility”. But the problem is no amount of responsibility can create opportunity where the private market fails and government is unwilling to step in.
What my people and many Australians need is real opportunity. And the best real opportunity is a job.
Those who are denied a job know that unemployment is a slippery slope. For those Australians who are unemployed for more than 12 months, there is a 70% chance they will remain unemployed in the following year; and 80% the year after that and 90% the year after that. If not addressed quickly, unemployment can easily turns into a condition. And if you have that condition the private market won’t treat you.
For close to four generations, the private market hasn’t wanted my people. Now my communities are ravaged by passive welfare and hopelessness. This is not something that I want for my fellow Australians to experience and this is why I am arguing for a Job Guarantee.
A year ago I met Professor Bill Mitchell, the founder of the Job Guarantee concept. Since then I have worked with him to develop a proposal for an Australian job guarantee. Such a jobs scheme that could be universally applied, or applied to places of high unemployment or applied to vulnerable groups like the young or long-term unemployed.
The concept is simple. It is a job for all those who are able to work. The job pays the minimum wage, superannuation contributions and leave entitlements. It brings the dignity of work to every Australian including the disabled, mentally ill and extremely disadvantaged. And it is a better alternative to passive welfare.
The jobs would be provided by State and Commonwealth Governments, local councils, accredited NGOs and social enterprises.
In arguing for this concept, I have been told by political advisors these jobs would be ‘unproductive’, ‘not real jobs’, ‘not interesting to people’ and would ‘undercut the private market’. This is simply untrue.
Nobody should underestimate the benefits that flow from a child seeing their mother or father go to work.
The Centre for Equity and Full Employment and Jobs Australia identified hundreds of jobs that could be performed under a Job Guarantee scheme in communities all across Australia. We have the imagination and ingenuity to create productive jobs. Innovation and creativity will enable us to deploy our unutilised labour in new endeavours that can serve our communities.
For those that need to put a number against the investment, our conservative modelling shows that unemployment is costing Australia $200bn a year in lost productivity. If a Job Guarantee was introduced to reduce unemployment to 4% (as a first step) the Australian economy would grow by $100 billion annually and GDP would increase by 5.3%. In short, this would be the biggest productivity reform a government could commit to.
I think there is a great opportunity for the Tasmanian Government to lobby the Federal Government for a Job Guarantee for this State most disadvantaged communities and its young people. Which parent of an unemployed child would oppose an entry-level, minimum wage work opportunity to welfare?
Cassy O’Connor brought the motion to the parliament and to their credit the Labor Party, Independent Madeleine Olgivie and Speaker Sue Hickey supported it. The parliament and government should carefully consider the benefits that would flow to the people of Tasmania and its economy. We have to change our mindset back to the idea that the opportunity of a job for all those who need and want one, is the very definition of being an Australian citizen.
Noel Pearson is a director of the Cape York Partnership and co-chair of Good to Great Schools Australia.