When the Coalition was first elected in late-2013, Employment Minister, Eric Abetz, trumpeted that the Government would deliver a “powerhouse economy” that will produce one million jobs over five years and two million jobs over 10 years.
Prime Minister Malcolm Turnbull has since remained silent on the jobs pledge but continues to spuik the mantra of “jobs and growth”.
When Abetz first launched the target I noted that the one million jobs over five years – or 16,667 jobs per month – would actually represent a mediocre outcome that would be below the circa 17,200 jobs per month created in the decade to September 2013, which also included the fallout from the Global Financial Crisis.
This level of jobs creation would also be off a much bigger base than was experienced previously. To illustrate, the 2,047,400 jobs created in the decade to September 2013 was on a starting jobs base of 9,406,000, representing jobs growth of 22%. By comparison, if the Coalition achieved its broader 2 million jobs target in the decade from September 2013 it would represent jobs growth of just over 17% on a starting base of 11,453,600 jobs.
Australia’s population is also growing solidly, which (other things equal) means that employment must grow more quickly in order to absorb the additional workers.
For a bit of fun, I thought I’d once again see how the Coalition’s target is tracking against latest labour force data released yesterday:
As you can see, the Coalition is miles off target. Worse, most of the jobs that have been generated are part-time:
We also shouldn’t forget that housing valuations, household debt, and dwelling construction rates are all at record highs and nearing the end of the cycle. Once the apartment construction boom ceases to grow (let alone starts contracting) so too will the jobs it generates.
The decline in mining investment also has more downside and the car assembly industry is only part way through shuttering.
In no way can we envisage the Coalition hitting its 1 million jobs growth forecast. If anything, it will miss by a very wide margin. So much for Turnbull’s pledge of “jobs and growth”.
