The state of the economy at the street level

[Smurf1976]

there are just no white collar jobs.

We've spent the past 25 years gutting practically every blue collar job in one way or another. Either the industry has gone altogether (manufacturing) or the work is outsourced to the lowest tender with zero job security as a result (particularly relevant to what happened with old government roads etc departments).

All of this was, of course, masterminded and implemented by managers and others sitting in offices. The workers on the tools know full well just how inefficient it is, but unfortunately it never was about efficiency despite all the hype of the 1990's about being "competitive" with the rest of the world.

Now it's the turn of office workers to face the same fate with a bit of a difference. If you want someone to drive a bus or fix a road, then they need to live within a reasonable distance of the bus depot and the roads. You can't really outsource bus driving to China (unless the company is dodgy enough to be into 457's). But for the white collar jobs, well, your jobs are going to India....

At some point we'll realise that all this isn't going to work in the long term.

 

[waterbottle]

Just introduce a land tax already geez

 

[Wysiwyg]

All of this was, of course, masterminded and implemented by managers and others sitting in offices. The workers on the tools know full well just how inefficient it is, but unfortunately it never was about efficiency despite all the hype of the 1990's about being "competitive" with the rest of the world.

I knew there was a reason why Executive salaries are up to a hundred times their company workers average wage "per year". I don't understand why they think themselves as so f'n large.

 

[Tyler Durden]

What does working in superannuation actually involve?

My friend was 'investing' using people's super funds.

 

[qldfrog]

Just introduce a land tax already geez

land tax on home, no threshold...
that what is coming up and then a land tax equivalent if you do not own a place (renters)
yeap already in Singapore if I remember well and other countries
feel free to google....

 

[Tyler Durden]

I have a friend who works for a HR company, he wasn't very clear, but he said something about everyone in the company potentially being offered a redundancy (not sure how big the company is) due to the company losing a big contract.

Anyway, I like to check out various forums, and from time to time there's a thread asking what people's views on a recession are. I have noticed that probably around 75% of people think a recession is coming in the short to medium term. So I was wondering, do recessions occur even with the majority of people forecasting it? Can that attitude itself cause the recession? Or is it like a stock market crash where it takes most people by surprise?

 

[Wysiwyg]

Thanks for the reality check. I read an article about a 2015 recession and this last bit says it all.

The ducks are all lined up. A perfect storm approaches.

 

[sptrawler]

I have a friend who works for a HR company, he wasn't very clear, but he said something about everyone in the company potentially being offered a redundancy (not sure how big the company is) due to the company losing a big contract.

Anyway, I like to check out various forums, and from time to time there's a thread asking what people's views on a recession are. I have noticed that probably around 75% of people think a recession is coming in the short to medium term. So I was wondering, do recessions occur even with the majority of people forecasting it? Can that attitude itself cause the recession? Or is it like a stock market crash where it takes most people by surprise?

The positions vacant section of the newspaper, becomes shorter than the comic strip.

Most people in a secure job, don't even realise a recession is happening, it is only when they have to find a job reality hits.

A few of my ex workmates, who are trade/ technical background, have been made redundant. They didn't realise how few jobs are available, until they need one. Now they are getting very nervous as D day arrives.

The technical recession, where the economy contracts over consecutive months, really means nothing.
Unemployment is the big issue. IMO

 

[sptrawler]

Here is another example of W.A's employment problem, Austal Ships to lay off 300.

http://www.abc.net.au/news/2015-04-...eir-jobs-as-shipbuilder-ends-contract/6364068

We are all looking forward to those new jobs, the NBN is going to create.
You know the ones, over the net welding, online sparkie, internet connected scaffold.

 

[sptrawler]

The job situation keeps getting worse, but unemployment figures aren't moving, something doesn't add up.

https://au.news.yahoo.com/thewest/business/a/27046457/jobs-go-as-iron-ore-miner-halts-production/

https://au.news.yahoo.com/thewest/business/a/27046091/280-caterpillar-jobs-to-go-in-tasmania/

 

[Smurf1976]

The job situation keeps getting worse

Another 280 jobs gone in Burnie Tas.

Anyone who has visited Burnie in the past but hasn't been there for 20+ years would be truly shocked how it looks today.

N.W. Acid is long gone and demolished. So is Tioxide. So is the pulp (APPM, actually a paper and board factory but locals always called it the pulp). All closed and demolished. Now it's Caterpillar.

The once infamously polluted industrial town is neither polluted nor industrial these days. No more red water and white trees, no more foam on the beach and clouds of smoke billowing into the sky, no more acid raining down and rusting everything in sight. It's cleaner, no doubt about that benefit, but the social cost of long term mass unemployment has been truly terrible and just keeps getting worse unfortunately. Hundreds once worked at Tioxide, a quarter of the entire Burnie population, a lot of women as well as men, once worked at the pulp. Now another 280 jobs gone at Caterpillar.

Burnie symbolises everything that's gone wrong with Australia economically in my view. There's still a huge market for sulphuric acid, we still use paint, we still use photocopy paper and mines still need machinery. We still use all those things, we just don't make them here anymore. Where a huge factory making something of value for export once stood there is now a chain hardware store selling mostly imported products. So sad.

 

[sptrawler]

Also smurph with the drop in iron ore prices, W.A has had a rapid drop in royalties income.
This added to the expected drop of gst to $30c in the dollar, is going to mean the W.A government, will have to borrow $500m to give to Tassie.

How is the economy looking at street level? Not good IMO.

 

[sptrawler]

Also smurph with the drop in iron ore prices, W.A has had a rapid drop in royalties income.
This added to the expected drop of gst to $30c in the dollar, is going to mean the W.A government, will have to borrow $500m to give to Tassie.

How is the economy looking at street level? Not good IMO.

Actually just read this article on the ABC, W.A treasurer sums it up pretty well.
As Tassie shuts down and everyone moves onto welfare, the productive States have to pay more to fund it.

http://www.abc.net.au/news/2015-04-11/nahan-intensifies-attacks-on-smaller-states-over-gst/6385016

 

[Wysiwyg]

Burnie symbolises everything that's gone wrong with Australia economically in my view. There's still a huge market for sulphuric acid, we still use paint, we still use photocopy paper and mines still need machinery. We still use all those things, we just don't make them here anymore. Where a huge factory making something of value for export once stood there is now a chain hardware store selling mostly imported products. So sad.

Maybe we are moving away from trades and labour toward a suit and tie economy where people talk for their money.

 

[overlap]

Another 280 jobs gone in Burnie Tas.

Anyone who has visited Burnie in the past but hasn't been there for 20+ years would be truly shocked how it looks today.

We left Tassie over 15 years ago and the hollowing out of these areas is scary to see whenever we go back. I and may others got important career opportunities in hindsight off the back of those industries and I can't see any significant alternative underpinning for the local economies now.

The locals don't seem to notice. I guess you get used to gradual decline. Older folks aren't rich, but are set up OK. Younger folks have left or are sucking it up as best they can.

This says it all. I'm very familiar with the area being talked out. Spot on analysis.

http://www.idiottax.net/2014/08/when-you-have-no-economic-value.html

 

[Smurf1976]

Maybe we are moving away from trades and labour toward a suit and tie economy where people talk for their money.

To some extent we certainly are, but all that talking is sending money straight out of the country in most cases.

There's a huge economic difference between making cars (for example) and simply selling them. The former keeps money here, the latter sends it straight offshore in the hope that we can sell enough iron ore and coal to pay the bills. Not that mining has too much of a future - WA's iron ore reserves won't last to the end of this century at current extraction rates and it seems pretty obvious that the future for coal is limited in the long term too.

We're fast heading toward a situation where Sydney and Melbourne are the only places in Australia that are economically sustainable. Tassie has been basically stuffed economically since the 1980's, SA is in trouble now and it's not overly difficult to see that WA and Qld will eventually join that list in another 30 or so years time once the mines end up like Burnie's former factories and disappear one by one, never to be replaced.

If you look at Tasmania in particular, since European settlement the only time it has consistently performed well economically was the period 1916 - late 1970's on the back of heavy manufacturing industry. Prior to that it was agriculture and mining, they had their booms no doubt but overall didn't make the state wealthy. Since then it has become tourism, it creates a lot of jobs but the vast majority are low skill, low wage jobs compared to what's been lost in heavy industry.

Looking back at what's gone over the past 40 years, it's a pretty long list. APPM Burnie, HAL, Papermakers, APPM Wesley Vale, Wander, Tioxide, NW Acid, Southern Aluminium, Coats Paton, Waverly Woolen Mills, Starwood, ACI, ACL, Stanley, APM Port Huon, Electrona, Blundstone. And those are just the "big" ones that come immediately to mind, there's plenty of smaller things or that I've forgotten.

Then there's things that still exist as such but which have radically downsized or moved to being an import operation rather than production. There were two gas production plants, now it all comes from Vic. The Hydro used to have 3000 construction workers but that's all gone now since there's nothing being built. TEMCO, Bell Bay Aluminium, the zinc works and Norske Skog (formerly ANM) are still running but have each shed 1000 - 2500 jobs from their peak. I doubt that anyone seriously expects that all of the "big 4" (which used to the "big 5" until APPM closed) will be here forever.

The state's image may well be of wilderness etc, but economically Tassie was extremely reliant on manufacturing. As the factories have gone one by one, high wage jobs have been replaced with, at best, lower wage service industry jobs.

Much the same applies to SA really.

 

[Smurf1976]

Actually just read this article on the ABC, W.A treasurer sums it up pretty well.
As Tassie shuts down and everyone moves onto welfare, the productive States have to pay more to fund it.

Tas and SA both suffer hugely from the absentee landlord problem, not just literally but politically as well.

The decisions which ultimately put an end to most manufacturing in Tas and SA weren't made in Hobart and Adelaide. They were made in Canberra and overseas, influenced heavily in Sydney and Melbourne. That's the crux of it. Both states were developed on the basis of an economic model which no longer applies due to decisions made elsewhere.

WA won't keep their "per capita" view for too long if external forces lead to a stagnation and ultimate shutdown of the state's mining industry. Same with Qld.

Sydney and Melbourne are really the only places in Australia that are somewhat in control of their own destiny. Everywhere else is ultimately at the mercy of decision makers elsewhere.

 

[overlap]

Meanwhile on a planet far, far away....

http://www.theadvocate.com.au/story/3004251/whiteley-angered-by-a-terrible-decision/?cs=87

http://www.theadvocate.com.au/story/3004254/flow-on-effect-tipped-to-hit-1000-workers/?cs=87

 

[sptrawler]

Tas and SA both suffer hugely from the absentee landlord problem, not just literally but politically as well.

The decisions which ultimately put an end to most manufacturing in Tas and SA weren't made in Hobart and Adelaide. They were made in Canberra and overseas, influenced heavily in Sydney and Melbourne. That's the crux of it. Both states were developed on the basis of an economic model which no longer applies due to decisions made elsewhere.

WA won't keep their "per capita" view for too long if external forces lead to a stagnation and ultimate shutdown of the state's mining industry. Same with Qld.

Sydney and Melbourne are really the only places in Australia that are somewhat in control of their own destiny. Everywhere else is ultimately at the mercy of decision makers elsewhere.

Agree with you smurph, the end result IMO, will be a huge drop in living standards.

Our dollar at parity with NZ, tells the whole story, the markets don't see a viable economic model in Australia.

I will be very suprised if we don't see the Aussie $ back at 50c U.S, within the next five years. Not that it will help, manufacturing will never return, to past levels.

 

[McLovin]

Tasmania seems to have the trifecta of narrow economic base, poorly educated workforce and geographically isolated from the mainland.

And Jackie Lambie.