Like its tribal precursors in 1945 and 1994, Labor’s employment white paper brings together the party’s grandest visions and its workaday policy tools in a bold statement of intent.
Of course, the times and resources available to Anthony Albanese are very different to his predecessors, but the aims are no less ambitious.
John Curtin’s post-war game plan aimed to keep the nation humming during a time of depleted resources. Paul Keating’s Working Nation was a response to re-engage workers who bore the brunt of the 1980s restructuring and help the wounded from the recession he’d declared, “we had to have”.
Working Future seeks to build on the pandemic’s platinum lining of low unemployment while navigating the disruptive mega trends of rising protectionism, income stagnation, societal ageing, digital upheaval, decarbonisation and geostrategic ruptures
The white paper puts all the pieces of the Prime Minister’s policy forays this past 16 months into a narrative that began during the election campaign: “No one held back, no one left behind.”
It picks up agendas on education and training, migration, social inclusion, clean energy, digital economy, industry development and productivity and seemingly joins the dots.
Yet Monday’s statement is inevitably where Labor’s opportunity society crashes into the limitations of Albonomics.
This plan depends on raising the speed limits on economic growth, so the economy can run stronger for longer without igniting higher inflation, but details only policy baby steps to that end.
Treasurer Jim Chalmers and Reserve Bank governor Michele Bullock are not far apart in spirit on achieving full employment, which the latter described as “people are able to find a job without having to search for too long” rather than zero unemployment, which is not feasible.
The new deal on the conduct of monetary policy the two are working on will invoke the vibe but invariably for the RBA’s mandate, full employment is a narrower concept, a technical balancing point for labour supply and demand. For the setting of interest rates we need clarity, not the grey zone of aspiration, and there’s always a trade-off.
But Chalmers, union man and social democrat, wants to drive down that “observed” theoretical rate lower than the econocrats at Treasury and the RBA have thought it to be. May he succeed in this quest, for it’s a life’s toil.
With unemployment below 4 per cent for so long post-Covid, amid a surge of foreign students and temporary workers, those still without a job are the most disadvantaged, and perhaps have never worked.
Addressing the structural factors that are holding back the chronically underemployed, including, but not exclusively, people with a disability and Indigenous Australians, will require surgically precise interventions. There are other disincentives in our tax-transfer system that are inhibiting so-called secondary earners in families and those receiving income support payments.
For instance, when a person on JobSeeker moves to work, they lose a range of health, transport and utility concessions. The government will extend to three months the period before these benefits cease.
But the “poverty traps” and high effective marginal tax rates that have irked welfare agencies largely remain, as officials are in a budget-constrained era.
Albanese Labor again puts its productivity agenda in lights, but reform is a slow train coming on an old track, while even then ignoring some of the warning signals. Chalmers says he wants a more dynamic economy, where competition flourishes and business investment is encouraged.
Implicit in the white paper is a view that the Productivity Commission is stuck in a time warp and we need fresh thinking on today’s issues; less market, more government hand in key decisions.
Certainly the energy transition will need public investment because we wasted a decade and a half adulterating price signals. Of course, it’s more expensive this way, but we opted for third-best and the clock is ticking on net-zero
The business lobby welcomes the white paper as an action plan but holds back its full endorsement because of Labor’s retrograde workplace laws and proposals.
There is a high degree of theatre in the labour-versus-capital tussle, amid a cost-of-living struggle, but there are many non-combatants perplexed by the government’s actions.
Less flexibility at the enterprise level is a productivity killer, not enabler, and will lead to less investment, weaker economic growth, stagnating real wages and probably more entrenched oligopolies.
For the ace striver from public housing, who rose to the very top of Australia’s political pyramid, that will mean job security for some and doors of opportunity closing for people lost on the fringes.
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