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Issue #1627      February 19, 2014

Make jobs the priority

Last week brought some relief to SPC Ardmona’s (SPCA) workforce with a commitment by the company to remain in operation for five years. But even this one bright spot in a week of bad news could see some workers lose their jobs. Unemployment has risen with full-time jobs, in particular, taking another hit. Public and private sector sackings continue to mount, with many more in the pipeline. Economists warn of worse to come and the prospect of recession rears its ugly head.

Meanwhile, the Abbott government cannot move fast enough with its cuts and sackings. It seems determined to drive the economy into recession. At the same time, it is blaming the victims of its cuts and other policies and preparing punitive cuts to the entitlements of the unemployed, in particular young people.

The Victorian government agreed to a $22 million “co-investment” towards a $100 million refit at SPCA’s cannery in Shepparton on condition that it retains a minimum of 500 staff. If it closes within five years, it will have to repay the money. This is welcome news for Shepparton and the farmers and others dependent on the cannery.

But the underlying problems have not been addressed. Not only did the federal government steadfastly refuse any assistance, it has done nothing to stop the flood of cheap fruit and other foods being dumped on one of the most open and deregulated markets in the industrialised world. The situation looks set to worsen under free trade agreements, in particular the Trans Pacific Partnership if it is signed.

Decline in full-time jobs

The official unemployment figure rose again in January to a whopping 728,600. That is 728,600 workers could not even find one hour’s paid work in the previous couple of weeks. The real picture of unemployed and under-employed is closer to double that figure. Hundreds of thousands of workers are in casual employment, living from day to day without any certainty of what lies ahead. Many can only find part-time work or short-term contracts. They do not appear in the official unemployment figures.

The media casually announce the unemployment rate has risen slightly to 6.0 percent, suggesting it might be bad news for the government.

Yet job insecurity continues to rise, and employers are on the offensive reducing wages and looking to a very supportive government to assist them.

Every one of those 728,600 people is a human being with a life to lead and needs that must be met. But the government is only interested in private sector profits, not whether lives are ruined or children go without. The prospects of finding work or affording retraining are growing dimmer, especially with TAFE closures, rising fees and inadequate income support.

Toyota

Toyota is a classic example of the government’s policy failures. Far from attempting to address the departure of Toyota from Australia in 2017 (or maybe even earlier), the government blamed Toyota’s workforce and the Australian Manufacturing Workers’ Union for the impending closure. AMWU members had earlier knocked back an attempt by the company to cut pay and entitlements which would have cut the cost of making a car by $147 – hardly enough to make the product more competitive!

Toyota’s response was incredible for an employer. The company, in effect, accused the government of lying. “Toyota Australia has never blamed the union for its decision to close its manufacturing operations by the end of 2017, neither publicly or in private discussion with any stakeholders,” the company said in a statement.

Toyota identified a number of contributing factors including the relatively high dollar that makes exports unviable and the low economies of scale in Australia – a country with a relatively small population. These factors, together “with one of the most open and fragmented automotive markets in the world and increased competitiveness due to current and future free trade agreements, [mean that] it is not viable to continue building cars in Australia.”

In other words, it is blaming government policies, not workers or unions.

The Australian economy is one of the most deregulated of all the industrialised nations and it is costing us heavily. Its tariffs on imports are amongst the lowest in the world.

The government doesn’t care one iota if the whole car industry folds or that thousands of workers will be sent to the scrap heap or that Australia will see the destruction of an important skill base. It has no vision, no plans for a manufacturing base in the future.

The Trans Pacific Partnership Agreement poses an enormous threat to Australian industry, not just manufacturing. Foreign corporations will have more rights under the TPPA than Australian ones and will be able to sue the Australian government for any decisions or legislation that might hurt potential or actual profit-making activities. It will not have any means to protect any industry.

More jobs in the firing line

Job losses continue to mount in the public and private sector. Around 60,000 full-time jobs were lost in the past four months with a small rise in part-time work.

The Forge Group in Western Australia has retrenched 1,300 workers. WesTrac has begun sacking 440 people in WA. Telstra is looking to outsource another 1,000 jobs to the Philippines and India, after slashing its local workforce by 2,000 last year.

The Australian Taxation Office is set to close its Valuation Office with the loss of 200 public service jobs on top of the previously announced cut of 900 jobs in the ATO this year.

State governments are still sacking thousands of employees or not filling jobs as public servants leave. In NSW the toll stands at 15,000; in Queensland it is headed for 14,000.

The media make a big show out of the likes of Toyota, Ford, Holden or SPCA when jobs are being shed. But there is a deafening silence around public sector sackings which are just as destructive to the people affected and the economy.

Government job cutting not only inflicts pain and hardship on those losing their jobs. It affects the many thousands whose future employment prospects are wiped, especially younger workers. It also has an impact on those who rely on the services that are cut or reduced.

Beyond that it has a contractionary effect on the economy as incomes are reduced and demand for goods and services shrinks. As sales decline, more workers are laid off or their hours reduced. And so the downward cycle continues.

Work is a basic human right

No capitalist country has ever achieved full employment. The boom-bust economic cycle sees swings in unemployment rates but never genuine full employment. Unemployment is endemic to capitalism and a tool to pit workers against each other to drive down wages and working conditions – the cost of labour.

Downturns are inevitable in the capitalist system – the boom-bust cycle cannot be eliminated as the mining sector is well aware. But government policies can impact on the depth and length of recessions and assist its victims with appropriate actions.

Unions are fighting in their own areas to save jobs and services – nurses in hospitals, teachers in schools and TAFE, public servants in the public service, etc. What is required is a national campaign to save at risk industries, the public sector, jobs and services; to defend and improve living standards; and to restore trade union and other democratic rights to be able to fight the Abbott government/employer agenda.

If corporations cannot run enterprises such as the car plants currently listed for closure, they should be nationalised and converted to produce the public transport vehicles or renewable energy equipment we urgently need.

The so-called “free” markets have got us into the current mess and have no solution for people, only for bigger and bigger profits. Australia needs a government of a new type that is prepared to stand up to the big corporations and act in the interests of people. This requires radical changes in policy based on government regulation, expansion of the pubic sector, reversal of privatisations, an increase in social security payments, job creation programs and, above all, planning.

Next article – Editorial – Vatican claims anti-Catholic conspiracy

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