NEWSFLASH! In September I will join The Conversation as its Business and Economy Editor. I have been honoured to work at The Age for the past ten years, originally alongside the legendry Tim Colebatch, and for the past four years as economics editor in my own right.

At The Conversation, my job will be to make the best thinking from Australia's 40 univerisites accessible to the widest possible audience. That means you. From the new year I will also write a weekly column.

On this site are most of the important things I have written for Fairfax and the ABC over the past few decades. I recommend the Search function. The site is a record for you, as well as me.

I'll continue to post great things from The Conversation and other places here, and also on Twitter and Facebook. Enjoy.

Saturday, August 10, 2013

Mostly False. Abbott could create 2 million new jobs


Abolishing the carbon tax, the mining tax and getting productivity up could "produce 1 million new jobs in five years, 2 million new jobs in a decade"

Tony Abbott, August 8 2013, Devonport


Tony Abbott says he has a plan to create jobs.

As he put it on Thursday: “Abolish the carbon tax, abolish the mining tax, get productivity up”.

He said it could “produce 1 million new jobs in five years, 2 million new jobs in a decade”.

Two million is an extraordinarily big number to add to a workforce of 11.6 million. But it has happened before.

Supporting evidence

In fact it’s happening now. Australia has producing new jobs at the rate of 2 million workers per decade since December 2006. The latest figures show the number of Australians in jobs climbed 2.2 million in the decade to July. So it ought to be easy to continue.

But does it stack up?

Population growth should help. Bureau of Statistics projections have Australia's population growing by between 2.7 million and 4.2 million over the next decade.

But it’s not that simple. Although Australia’s total population will keep growing, its working-age population will not. Adelaide University demographer Graeme Hugo says Australia’s working age population is set to peak and stop growing within a decade as baby boomers become retirees and give up work.

It’ll make Tony Abbott’s target of 2 million more people in jobs much harder to achieve than history suggests, perhaps impossible.

(Perversely, it should make it far easier than it used to be for anyone who is of employable age to find a job.)

Except for this. It won’t be Abbott that creates those jobs.

Here’s his Treasury spokesman Joe Hockey three years ago this month, campaigning in the same town - Devonport.

“Governments don’t create jobs, business creates jobs. Employers employ people, not governments.”

He could have added that demography - especially immigration - has a lot to do with it too.

Abbott is wrong to say that his “economic plan can produce 1 million new jobs in five years, 2 million new jobs in a decade”.

Most of those jobs would be created anyway, even without his economic plan. And changing demographics will make that difficult.

Finding

Politifact rates the claim “mostly false”

Politifact and The Sydney Morning Herald



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