HOUSE OF REPRESENTATIVES, 2 SEPTEMBER 2020
In March my constituent Chris Endrey found himself jobless. As he put it:
The financial distress of this period has pressed into other areas of my life, with deleterious impacts on my health; a loss of housing security; the loss of higher order capacities, which evaporate in the face of such baseline pressures… I'm so desperate to end my hours of infinite couch surfing ,writing stupid letters and instead channel my energies and talents into something of use to our rumbling society.
Chris Endrey is among the one million Australians out of work. Another 400,000 will lose their jobs before Christmas.
Unemployment can have devastating impacts on physical health, on mental health, on relationships, on marriages and on children. A job isn't just a source of income. It's also a source of self-esteem and identity. That's why we so often ask someone at a party, 'So—what do you do?' The impact of joblessness is worst for young people. There's Treasury research showing that the scarring impacts can last up to a decade, and have gotten worse over recent decades. That's why the government's short-sighted cuts to university are so damaging to young people.
Today, we've learned that there was a seven per cent drop in national income last quarter. Australia, as of today, is in its first recession in a generation and the worst downturn in nearly a century. The Australian economy approached this downturn from a position of weakness. We started this year with the worst wage growth on record. Household spending was growing at the slowest pace since the global financial crisis. Retail was in its deepest slump since 1990. Last year, new car sales fell eight per cent. Construction was shrinking at its fastest rate since 1999. Business investment was at its lowest level since the 1990s recession. Labour productivity, output per hour worked, fell 0.2 per cent in 2018-19. The rate of new business formation was declining. The rate of job switching was down. Geographic mobility had fallen. We were in the Morrison stagnation at the start of the year, and we're in the Morrison recession now. Despite this, the government has left out casuals, arts workers and the university sector from its response. The government now plans to cut JobKeeper and JobSeeker at the end of the month. The economy has not snapped back as the Prime Minister promised, but he's snapping back support all the same. The HomeBuilder policy hasn't delivered one dollar of support. Australians are flying blind, with the government having promised to provide regular unemployment data to the COVID committee and having broken that promise.
What we need isn't just fiscal stimulus; we need stimulus that also leaves a positive legacy. That could include investment in renewables: making buildings more efficient, building cycle paths, car chargers, public transport systems and solar and wind farms. We could improve educational outcomes, given that, as we know, Australia's test scores in maths, science and reading have dropped since the start of the century, and COVID has widened the educational gap. We could help turn that around by engaging additional educators to provide intensive support to our most vulnerable students. We could build more social housing, as the member for Blaxland has pointed out, dealing with the fact that the home ownership rate is now at a 60-year low. And we could work to reduce inequality. Recessions tend to hurt most those who have the least. Low-income workers are less able to telework. People with few assets are most vulnerable to dropping off the edge. We should make paid pandemic leave available to all workers. We should expand child care to help counteract the disproportionate effect of the downturn on women. Firms getting JobKeeper shouldn't be paying out massive CEO bonuses and excessive dividends. I thank the member for Herbert for his support of that position in the press today.
If we get this right, we have an opportunity to emerge from this crisis as a nation that puts connectedness ahead of selfish individualism. We need an engaged egalitarian approach. We need to recognise that the world isn't our enemy—that trade, migration and foreign investment have been fundamental to Australia's productivity growth. If we continue the attacks on ‘negative globalism’, if we continue the populist political attacks on overseas nations, then Australia will be poorer and our recovery will be slower.
If we're going to get out of the Morrison recession, we need a clear plan. We need a smart stimulus, and we need engaged egalitarianism.
Authorised by Paul Erickson, ALP, Canberra.