Prolapsed anus economy farts bureaucrat boom

One of the more darkly amusing aspects of COVID-19 was how it illustrated that so much of our economy is no more substantial than a fume. Despite shutting down huge swathes of GDP, government spending simply stepped into that income breach without great disruption to much. This is because so much of our “production” these days is no such thing. It would be better referred to not as the production of “widgets” as it is the production of “wankets”, The many little high touch services that we these days consider hard economy activity even though they are little more than the personal care services that dominate our suburbs. Recall my previous writing on this subject:

All of these local shops are a hive entrepreneurial beavering. But all of them are directed inwards in an endlessly dividing paradox of insignificance. None of them is tradable, as services mostly are not, so none has the chance to flower much beyond the local shops, let alone nationally or internationally. That poses a problem for the economy because if all you ever do is service one another in more elaborately infinitesimal detail then there is no actual wealth generation going on. There was no organic capital generation, no capital deepening nor breakthrough’s in efficiency. The capital that drives this machine by definition comes from outside of it in the form of a visitor, a new buyer of a local asset or someone that has borrowed to invest.

This is even more interesting in terms of global trends. The K-shaped economy of 2020, which saw global goods orders and production boom, has hardly touched Australia. We’ve seen a little lift in the hard production of “widgets” as manufacturing came out of the slump a little earlier than other sectors but from a very low base. We’ve simply subsidised our “wankets” such that they could carry spending on without carrying on working, as it were.

For a little proof of this, let’s turn to some new SEEK data that records the various trajectories in job ads over the past year. The headline numbers look pretty good:

Towards the end of the year and into 2021, certain states and industries found it harder to fill vacancies. As we saw an increase in job ads this reduced the availability of candidates, as more ads offer more choice for job seekers. Industries with customer-facing roles saw a drop in application volume, in some cases by up to 30% y/y.

Job seekers are being more selective when choosing which roles to apply for. While the number of job seekers viewing ads is equal to the same time in the previous year, the number who go on to apply is 10% lower year-on-year (as at December 2020).

This behaviour is in contrast with what we saw at the start of the pandemic, where applications per ad were typically higher than usual. So, it’s increasingly becoming more of a job seekers’ market, particularly in Western Australia and Queensland, and in industries like Trades & Services, Manufacturing, Transport & Logistics, Hospitality & Tourism and Retail.

Seek job ads 2020

Seek job ads 2020

The forefront of the anus economy is consumer services. There the COVID-prolapse struck hardest but then rebounded just as hard as lockdowns did their work:

Consumer Services roles are the front line of customer contact, and unsurprisingly this sector was hit the hardest as the pandemic evolved.

However, its recovery also went hand-in-hand with the lifting of restrictions. During the four weeks of April 2020, Consumer Services were at just 17% of pre-COVID levels but have since recovered well.

Consumer Services roles are 7.4% higher from November 2020 to January 2021 than in the same period 12 months prior.

Seek job ads 2020

Seek job ads 2020

Sadly, the more qualified producers within services, that do generate widgets, are still high and dry. This is a problem because that segment includes such wealth generators as education and science. Other sectors have enjoyed “catch-up” growth as they recovered their losses.

But, notice where the real recovery sector is: bureaucrats. This is where unproductive “wankets” are absolutely booming.

Because “wanket” production is by definition insubstantial and capital-lite, is it any great surprise that it comes with rising job insecurity?

Unsurprisingly, the mix of work type among advertised roles changed slightly in the last year with casual work making up a higher percentage of roles. Looking even further back, from 2013 to 2019 the portion of casual positions advertised on SEEK has grown from 6.0% to 8.8%. This number increased to 11.6% in 2020. In addition, part-time roles rose from 7% in 2019 to 8.5% in 2020.

Leading up to last Christmas, there was an abnormally high demand for casual (36.1% y/y) and part-time (29.4% y/y) roles.

This was due to a delayed pre-Christmas ramp up and a change in the mix of role types being sought generally.

The table on the left shows how the different work types have changed since April 2020. There has been a split as more casual, and part-time roles have been advertised. As of January 2021, casual (42% y/y) and part-time (36%y/y) roles increased y/y. Full-time positions still make up the majority of job ads but are down 3% y/y.

Seek job ads 2020

Seek job ads 2020

That said, easy come, easy go is also easy come again:

When events impact the labour market, we look back at past data and trends that can give us insights into what may happen. For example, each year, we know that Easter is a quiet job advertising period and the time that it falls impacts job ads differently each year.

The 2008 Global Financial Crisis (GFC) provides the closest comparison for the impact that COVID-19 has had in the job market.

As you can see from the graph, COVID had a swifter and more sudden effect than even the GFC. The good news is that within two months of the initial outbreak here in Australia, we had already reached the lowest number of ads before job ads started to recover.

During the GFC, job ads dropped to below 60% of volumes after seven months and stayed there for four to five months before starting to return. COVID hit rock bottom in April and starting to return from May.

In other words, the falls observed in the first three weeks of March 2020 took three months during the GFC.

Seek job ads 2020

Seek job ads 2020

Now, I don’t mean to be critical of the anus economy (well, yes I do). It is certainly flexible given it can substitute income easily from private to public sources without actually causing much harm to what’s left of productive capacity. Plus, as we enter the MMT age, there is no end in sight to the sustainability of “wanket” production given the external input of endless debt now has no limit.

But I do wonder if over the longer term we wouldn’t be better off having two classes of GDP. The whirring of widgets in manufacturing, capital deepening, productivity-enhancing infrastructure, intellectual property etc might be counted at 100%. The production of “wankets” by bankers, bureaucrats, consumer services etc might be better discounted according to a “wanket deflator”.

It does come with the risk of embedded class warfare in GDP accounting but we might also find that everybody is better off eventually as a more productive economy lifts incomes instead.

David Llewellyn-Smith
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Comments

  1. Agree. With a complete shutdown event/s like COVID and total collapse not eventuating it was total proof of the bullshit jobs theory. Keynes was right, we should be working 15 hr weeks. This economy is a contrivance to keep us all stressed and occupied so we don’t cause trouble or rise above our station. Hurry up and pay me funny money to retire you jerks! You might just save the planet at the same time!

    • The90kwbeastMEMBER

      Kind of like a capitalists version of 1984… the elite do things to maintain power and part of that power is having a busy bee proletariat full of distractions so as to never question why people are working harder and harder.

  2. MathiasMEMBER

    So Australias a Country that prints money out of a printing press, floods itself with Beuracrats who in turn buy Houses.

    So beyond that, we have no actual real economy left.

    So we need more Migrants, to buy more houses, to become more Beuracrats so we can print more money?

    So its basically the same just in reverse.

  3. MathiasMEMBER

    There’s something in my head thats just eating away at me.

    How can Liberals not look out there window and see whats going on in Australia today? This stuff is pretty damn obvious to anyone with eye sockets who can see more than five meters in front of them. How is it that the Liberals have survived this long without Parliament turning into an explosive argumentative furor from everything we are seeing going on right now? I just find it hard to believe that the Liberals are really this stupid and this is being Economically driven. Even the dumbest Liberal would have to have half a brain to see where this is heading? How can they not?

    The other thing I find confusing, knowing many Aussies as I do, is where has all that Aussie Spirit gone? What the hell has happened to this Country? I mean, you’ve got Migrants literally walking around Australia everywhere and bullying Aussies into the ground while Aussies are so wrapped in low self-esteem that they just walk away and do nothing. I mean, did we suddenly just lose all that Energy and Spirit? Are Aussies Dead? Where has all that Energy gone? Has ASIO been chopping the head off every snake to stop dissenting opinions forming in this Country ensuring Liberals remain in a constant state of Tyranical Power? or have all the Aussies just suicided and Australian Suicide Data has been bogus for 15 years?

    Surely, there’s got to be something else going on here behind the scenes then just economics. There’s got to be more going on here then just COVID and Economics. None of whats going on in Australia today is Natural and there’s got to be something going on behind the scenes which isnt being revealed to the public. I find it hard to believe that murdering off this Country is all because of China. There’s something more sinister at work.

    It must be becoming pretty damn visible by now. I just find it hard to believe that Liberals dont see it and Australians are without Energy while all this is being done to them. Not a single protest. Am I the only one who finds this odd? The only energy I’ve seen in this Country are the Boomers attempting to extort everyone for every last dollar they have and calling that Australian Progress.

    It must be pretty close now. Im guessing a lot of business’s are going to fold within a year. It must be hard to not see whats going on in front of our eyes? Even a child would see it.

    • fitzroyMEMBER

      Spot on. Often the bureaucrats are preferentially hired from offshore. Example Dan’s dept. of transport- spot the Aussie cis male. Population economic replacement.

        • boomengineeringMEMBER

          Ben, that’s mainly not racist it’s corruption. The reason they do this is many fold, but the main one is the person in control of hiring, scalps/ garnish’s the employee’s wage by 10% so actively seeks out his countrymen familiar and compliant with the system. The comfort zone of cast, colour, creed with their work environment is also a factor but is racist within their own original country’s boundary.
          This system will ruin Australia as the preferred employee is under qualified as to be subservient to ensure stability. This in turn leads to less productivity and less competitiveness in the world stage

          • Agent 47MEMBER

            It’s 100% racist – literally in group preference and works both ways. Counter productive self-loathing and avoiding discussing the obvious only worsens the problem.

          • boomengineeringMEMBER

            First hand experience.
            Was doing the occasional labour hire to avoid talking to Mr milling machine and Mr lathe all day alone in my workshop.
            One day came to a papermill shutdown and the boss screamed what’s he doing here get him out of here. I had versed my opinion of illegal immigrants the time before to the curry muncher. The Newcrest Mining Lihir Island rife with diseases experience fresh in my memory. My mate had to find his own way home after his shift.

          • NoodlesRomanovMEMBER

            Boom – I’m trying to figure out what happened in that second comment. The paper mill shutdown manager only wanted a certain type of contractor and certain other types got run off before they started talking about how they are on an hourly rate that they can live on?

          • boomengineeringMEMBER

            Nah, I am a contractor but because I do so many different disciplines I needed too many different tradesmen employees and also do work that no one else can do or wants. So by the time I held their hand may as well done it myself. That meant being by myself in the factory so had to work as a subbie for the labour hire occasionally (for interaction with like minds).
            Was having a friendly chat with the curry boss and mentioned they shouldn’t let illegals into the country citing my experience of diseases at Lihir. Thought nothing of it until was turfed out before work started next time there.
            Who knows what the motivation was . You can only imagine.

    • It’s like the Matrix movie is becoming true and unfortunately most of the country have taken the blue pill and don’t want to know.
      The narrative from MSM is exacerbating this. Let the hunger games begin.

    • Cynical snake

      “How is it that the Liberals have survived this long without Parliament turning into an explosive argumentative furor from everything we are seeing going on right now? ”
      Because anyone with a dissenting voice removes any chance of being selected for parliament long before they get anywhere near it.

    • There’s no “aussie spirit” because the majority have too much to lose.

      So many on here acknowledge it is a BS economy but what is the alternative? In reality there are very few real, value add jobs that are needed. That means if we rise up we have a greater chance of losing more than we gain. I’m not saying it is right but there are very few who are really hungry/commercial enough to do better.
      If you work in a large organisation you’ll know there is a % of people who actually believe the BS that is sprouted (generally the Compliance & HR types). Then there is a large % who know it is a game but they don’t make the rules and if they just go with it they’re alright (Finance and sales folk?). There are also the sociopaths that believe their own BS and rort the system for personal gain (the execs).

      The minority who see the whole system as wrong get frustrated and angry and try to fight the system and in the end they burn out. They either stay in the large organisation as a bitter “disengaged” employee or go out on their own and really add value as a small business person. But you know what – it is damn hard out there running a business and trying to stay ahead. Of these folk who really has the energy (let alone the numbers) to change the system?

      Pretty depressing really but once you accept the system and the fact that the majority of folks are ordinary and the majority of ordinary folks work in a large organisation you can be at peace with yourself. yes that means working in a large organisation means dealing with ordinary people but hey just go with it and get your satisfaction outside of work.
      My 2c worth anyway.

    • reusachtigeMEMBER

      There are therapists that specialise in helping people with problems like yourself. Avail of them and become successful !!

    • Everyone likes to imagine that failing nations put up the good fight but are in the end overran by the barbarians.
      It’s awfully convenient that the barbarians arrive at exactly the required time, or more likely just the arrival of the barbarians gives us reason to pull the trigger and blow our own brains out.
      But isn’t this exactly what we’re doing, day by day we’re becoming a less capable nation, yet GDP skyrockets and Aussie’s celebrate our newly expanded mediocrity by borrowing $2+M for an “Investment Property”.
      Real Estate is the figurative economic shotgun, it’s loaded, it’s aimed, it’s ready, we just need to spot a barbarian and we’ll scare the heck out of them by blowing our own head off.

    • The90kwbeastMEMBER

      “Surely, there’s got to be something else going on here behind the scenes then just economics. ”

      Simple: greed. Everyone got ‘rich’ from their $1m houses thus are prepared to look the other way at all the other bullshit people are being fed from the Libs, one such issue being high immigration. When/if house prices crash that’s when you’ll get your blood on the street.

    • “I mean, you’ve got Migrants literally walking around Australia everywhere and bullying Aussies into the ground while Aussies are so wrapped in low self-esteem that they just walk away and do nothing. I mean, did we suddenly just lose all that Energy and Spirit?”

      What are you on about? Sounds like fascism. Blame immigrants for this? That’s a serious reacharound.

  4. “But, notice where the real recovery sector is: bureaucrats. This is where unproductive “wankets” are absolutely booming.

    Because “wanket” production is by definition insubstantial and capital-lite, is it any great surprise that it comes with rising job insecurity?”

    I challenge the assumption that public sector equals bureaucrats because it does also include teachers, police, fire and health sectors. Not your quintessential fat cats and arguably not producers of wankets. They may be potentially casualised but I see no causation or even correlation with public sector rebound in ads and increase in casualisation in your selected graphs.

    • MathiasMEMBER

      Australias Defence Force? Is Australia quietly recruiting an Army?

      Australias become a spooky place. I dont know why but something doesnt feel right.

      • UpperWestsideMEMBER

        Feels the same way here in NYC, everyone is edgy.
        Crime is up, the 2 guys shot last night (one in the head) on the Upper Westside , 2 blocks from my place, didn’t even make the morning news.
        The two shot a few hours later ( 6 blocks up, 4 over) ditto.

      • reusachtigeMEMBER

        Get off the cones bloke! Start to strive. Find your inner ambition. Make some success.

    • GunnamattaMEMBER

      About the only gigs ‘really’ on offer are jobs within government departments and budget funded organisations which arent public servants but ‘contractors’ who are recruited through employment agencies at a rate of about twice to three times what it would cost to employ a public servant – because all those ‘efficient’ private sector funds extraction mechanisms bolted to the public teat need a cut.

      They are all ’employed’ as ‘service providers’ and are all capable of being switched off the moment there is a question about ‘value for money’ from a taxpayer perspective. And many are doing menial bullshit too.

      Not just ‘Bullshit Jobs’ but ‘Bullshit Jobs of Bullshit funded by Bullshit with Bullshit accountability’

      Part of that is Covid and a simple get people into jobs in the here and now mindset – which is explicable – but a lot of it is also profoundly wasteful and being milked by the ‘efficient private sector’ bolted to the public teat.

      • Display NameMEMBER

        You are almost as upbeat about the economy as I am. I am glad I am at the back end of my working life.

    • Personal Risk ToleranceMEMBER

      Complaining about the number of health employees rising during a pandemic is absurd, but that has never stopped people here.

    • Mining BoganMEMBER

      What does Trinadad and Tobago have that we don’t?

      Estonia and Lithuania are kicking goals too. Just maybe there’s other countries we can learn from if we weren’t so goddamn corrupt.

      Edit: we’re only 19 spots ahead of Cuba, and when you have a look they only fell down the ladder with the usual troubles when the Republicans are in power.

      Actually, a closer look shows we were only four spots ahead when I was there in 2012. Lovely place but a bit of a mess. Is that what others see when they visit Straya?

      • Cynical snake

        “What does Trinadad and Tobago have that we don’t?”
        A shortage of natural resources to plunder.

    • darklydrawlMEMBER

      Oh, God that chart is depressing….
      Aligns with our Global fixed internet speed rating I was looking at this morning. 61st FFS. Trinidad and Tobago are 54th!
      https://www.speedtest.net/global-index

      I was looking at some old film archives from Adelaide. Have a look about 1 hour, 4 mins into the video. You can see what an industrial powerhouse Adelaide was back in the day. Now it is nothing but crickets. What a loss.
      https://www.youtube.com/watch?v=Wlw6PsXNKfE

      • Mining BoganMEMBER

        Lol, is Trinadad and Tobago going to become a meme?

        That’ll probably make us racialist.

      • rob barrattMEMBER

        Come now gentlemen
        Of course we have a complex industry:
        Car Repairs.
        You watch the news don’t ya? Bunch of 12 -17 y olds steal car and race it until they crash it somewhere. Out on bail the next day they do it again (and again and again and again….).
        Perfect for the industry.
        Meanwhile, forests are on fire because there is no labour to put to clearing undergrowth etc.
        The clever country…

    • Display NameMEMBER

      I have watched this for years. It is a bit of a curse of a resource based economy but the LNP (and Labour) have done NOTHING substantial to move away from this. We are adrift in the Pacific. On Munyana time.

    • We can only wish that we were 73rd (read the graph properly) we were 73rd in 2010 however in 2019 we’re 82nd.

  5. Population growth is off the record the only liberal strategy today. You watch the immigration number increase hugely going forward. The libs can then say they are the great job creators, without creating anything

    • MountainGuinMEMBER

      Yep, the immigration lever is easy to pull and gives short term gains to alot if thier constituents. Think about what reforms or improvements govt is driving? Come up with anything?
      I’m not sure if the lack of effort is a political issue, a corrupt media issue or maybe the population has largely got to disinterested to care anymore.

  6. DouglasMEMBER

    David you should hang your head in shame. You barracked on the Garnaut free trade chimera to drop tariffs to near zero when no one else was doing it. An example was the car industry -to give Thailand preferred trading basis when Ford had one of the largest manufacturing operations in the world there. Then subsidise the Australian industry as it was routed due to lack of economies of scale. Replace manufacturing with govt and mass immigration-that is the wank. I see that Rudd and Turnbull are still promoting mass immigration with no basis for their argument.

    Garnaut nearly caught in the Greensill/Gupta maelstrom/fraud. He extracted himself from it maybe 6 months ago. That is as much as this guy knows -could not pick a fraud from 20 paces.

    • fitzroyMEMBER

      Good point. The Harvard business school practice of exporting industries to enrich the 1%. Good for them not so good for the nation state. Now we have the privilege of importing cars from countries that built economies of scale behind tariff walls and are continually subsidising them only to have them tax deducted here so that we subsidised another country’s subsidy. No wonder this place is a basket case. What we need is more vibrancy.

      • rob barrattMEMBER

        The only things vibrating around our cties are the high rise blocks built on land prone to subsidence. Of course, when they fall down or the cladding catches fire, you find that the building company was a throw away job owned by an offshore company owned by a trust ..etc ..etc..

      • DouglasMEMBER

        Fitzroy very intelligent comment. So stupid to give tax subsidies for vehicles and not make them so supporting countries like Germany who try like crazy to keep their manufacturing strong.

  7. GDP wtf is it? what does it measure? why are we optimizing it? why does anyone talk about it?
    Anyone with a real interest in modern economics has long ago accepted that Connectivity is the only real measure of economic progress.
    Connectivity is a measure that you can’t fake, a business can’t become systemically important just because it wants to be important. Importance in this sense is derived from Economic connectivity.
    Our Politicians and bureaucrats hate the idea that connectivity is important because it’s something that they have zero control of. Matter of fact all their attempts to achieve importance, by boosting GDP, serve only to undermine our economic connectivity.
    If Aussie’s are interested in having a successful 21st century economy then we need to start by measuring what’s important and it sure as F ain’t GDP.

    • GDP wtf is it?
      A somewhat dodgy measure created by economists.
      what does it measure? $$ value of activity, completely independent of any actual benefit said activity has for the country and it’s inhabitants.
      why are we optimizing it? why does anyone talk about it? Because it is easy to measure and widely reported about/discussed.

    • If you want a measure of Australia’s economic performance which gels with the lived experience then go to
      https://atlas.cid.harvard.edu/rankings
      and type in Australia
      Check out our “progress” over the last 20 years, it’s hard to find a more depressing graph but it does confirm our lived experience here in Australia. Australia (2000) was 67th in the world atlas of economic complexity but is now 87th (just behind Botswana and Oman) and a long long way behind economic power houses like Costa Rica, Jordan and New Zealand.
      Before you get too worried check out the countries that are just below us on the chart like Cambodia, Morocco and Laos, they’ll be above us in no time flat if the current trends continue.
      In this sense we’re discovering our true place in the world, through Connectivity and complexity analysis long before we acknowledge it through Political and Economic measures.