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    Full Employment in Five Years
    — Sustainable community economic development

    from The Jobs Letter No.135 / 1 December, 2000

    by Warren Snow

  • I once heard someone say that a community that is not in control of its economic process will not be in control of its social processes. I have since seen first-hand many times the truth of that statement— and in all of my work over the last few years I have tried to find a common theme for processes that will enable communities to flourish and survive.

    For many people, the present economic system is not meeting their needs. In fact, we have just learned that around 30% of New Zealand children live in poverty. The bottom rung of the economic ladder has moved up and it is very difficult for increasing numbers of people to participate in society. We have attempted to compensate through social welfare but the rungs on this ladder go nowhere. There must be a different way!

    I have come to the view that sustainability is the key. It is a progressive concept, and by its nature, it unwinds many of the trends that have left communities powerless. The concept of sustainability also leads to an `ecology of community' that returns at least some of the economic processes of communities back into local hands to in turn reinvest in future local prosperity.

    I am convinced that most of the tools and solutions for the problems facing people lie within their own communities — the resources human, natural and economic just need unlocking. We have to create new rungs at the bottom of the economic ladder. This is quite achievable but requires community self-realisation and empowerment.

    There are many jobs in communities that need doing even though they no longer support a living for a person and are not self-funding. The market will no longer deliver these jobs _ neither will it provide finance, housing, community security and participation to a growing number of our society. The community sector though with a little support can step in and create a local infrastructure that will result in both employment and community wellbeing.

    Some examples:

    Many groups around the country are proving that there are jobs in recycling _ approximately 20 times more than through landfilling waste. The Zero Waste NZ Trust has been working over the last three years to provide support for a growing network of groups, projects and initiatives creating local business and employment opportunities from waste.

    These include a growing number of jobs making new products from recycled or recovered materials. A recent report by Robin Murray of the London School of Economics (Creating Wealth from Waste) suggests that the UK can create 55,000 new jobs through recycling intensive waste disposal. You can multiply that by a factor of at least 5 for the downstream jobs.

    A recent report from Japan predicts a 10% increase in GDP through recycling intensive waste management — that's a staggering $600 billion. In Germany the recycling industry, which includes significant manufacturing of recycling related plant and machinery is now bigger than their telecommunications and building industries.

    "Community enterprises are building new economies where the mainstream economic system has withdrawn — they are putting the bottom rungs back on the economic ladder for those who cannot find a way into the employment and business world."
    Warren Snow

  • Numerous studies from around the world are showing that the recycling and recovered material industries are one of the key job growth engines of the future — in California they are a calling it the new gold rush. Is clean-green New Zealand burying in landfills an industry that could rival Telecom or Fletchers in size? A 1996 survey of 64 recycling businesses in Auckland found a combined turnover of $ 133 million with 1700 employees on an average wage of $12 per hour.

    Over a very short span of a hundred years or so we have seriously degraded the Earth's living systems and this has impacted on local habitat areas in most communities. Society is recognising the need to pay people to put the environment back together. Habitat protection is a real business with a significant and growing market of funders worldwide who are prepared to provide the financial means to restore the earth. A number of communities have created initiatives employing people to do this work. The best ones are cross-sectoral initiatives involving schools, unemployed people, businesses and tourism groups — where the whole community can get involved for a win-win result all round.

    This is a relatively new area with significant growth potential. If we can help 4,000 homes to save $5 per week, we save a lot of energy _ in fact over $1 million per year _ money which stays in the community and in people's pockets. This creates jobs as groups train people in how to make a solar panel and to save energy or insulate houses. Interestingly we have had reports of health improvements amongst children in energy-retrofitted homes.

    There is also growth potential in local alternative energy generation. We can create a network of locally owned energy companies selling energy savings and solutions and in some cases generating power through windfarms.

    The Government and the private sector are no longer providing long-term housing solutions for people below a certain income level — perhaps up to 25% of people in New Zealand are effectively locked out of housing ownership. Part of the problem may be that there are a similar number who have purchased second and third houses as part of an investment portfolio.

    Low income housing provision is a training and job-rich area that, with the right support, will result in stronger and healthier communities around NZ. There are a growing number of groups emerging to provide housing for those excluded from the housing market. They all work in different ways and range from very well organised large national structures such as `Habitat for Humanity' to small local groups such as `Just Housing' in Dunedin.

    One thing that they all have in common is that they don't just build a house and shove people into it to fend for themselves. They involve the families in the whole process and make sure that they have a sense of ownership and pride through having worked for their home. They also provide ongoing mentoring and support and can identify other issues such as literacy that need addressing.

    Through my previous role with the Tindall Foundation we were able to assist in the development of a Trust that will provide support to these groups. The trust will attract funding from a range of sources and distribute them to local housing groups.

    Many farmers can no longer afford chemicals, and yet it is not easy to switch quickly to organic processes. When a farm does go organic however, the chemicals are replaced by labour _ financed by the premium that people are increasingly prepared to pay for healthy food. This is a significant area for job growth in the future, and we need to support groups working to promote organic practices and markets.

    A deteriorating environment means we will have to stop the depletion of the rainforests. In Kaitaia there is a group making wooden outdoor furniture from Eucalyptus, and it is of a higher standard than the imported versions made from rainforest timber. If New Zealand were to ban the import of rainforest products the market for locally made furniture would rise instantly.

    There is huge potential in alternative species to pine and opportunities galore for local groups to form community initiatives around planting surplus lands into sustainable forestry. Financing could come from a range of sources including private investors prepared to invest in their communities for long-term returns.

    Access to finance is the main impediment to small enterprise start-ups. There are a number of community loan funds around New Zealand specialising in providing low or no interest loans to low income people who want access to finance to help set up enterprises either as individuals or through non-profit groups. These funds are loaned out and repaid to be put to work again and again.

    The various local loan funds provide business advice and mentoring along with the loans and have surprisingly good repayment rates. They are picking up where the private sector has left off — providing access to capital for those who have usually no credit history or collateral and who the banking system have decide no longer have a right to participate in the economic system.

    These local revolving loan funds can also promote themselves to people who want to either gift or invest in back into their communities. We will find that not everyone feels the need to have their money ranging round the world for that one more point of higher interest — but we must build the alternative structures for them to be able to invest in local economic redevelopment.

    A number of the groups around New Zealand working in the above areas are defining themselves as community enterprises and are already responsible for many projects employing low skill and previously unemployed people.

    We need to support them with funds and capacity-building techniques. They are working with the sector of society that is the shock absorber of the main economy. They are building new economies where the mainstream economic system has withdrawn — they are putting the bottom rungs back on the economic ladder for those who cannot find a way into the employment and business world.

    "Is clean-green New Zealand burying in landfills an industry that could rival Telecom or Fletchers in size?"
    Warren Snow

    They are not a threat to the mainstream economic system — on the contrary, in many cases they are working in with private companies providing job-ready people with more confidence and creating joint ventures that enable mainstream business to work better in local communities.

  • Too often groups are funded for their projects and outcomes but find it difficult to find the support for new development work — or even for basic administration expenses. Funding must be friendly and at times patient _ to allow plans to unfold. There is risk involved, but there are good ways of achieving a high level of accountability whilst at the same time allowing groups to make changes in plans along the way.

    It's important that grant makers support people and processes as well as, or even instead of, projects and outcomes. There are "social entrepreneurs" in every community — they can and will make their projects happen but they need support.

    The closer you are to the problem the more likely you are to be able to solve it. The COGs model of distributing funds is successful because of the local accountability concepts it embodies. Community Foundations might also be a good way to allocate to local initiatives in communities around NZ and to help restore the "ecology of community".

    We have become a society that would rather build a new prison than address the deeper issues of crime prevention, a big new power station rather than conserve energy, a new landfill rather than reduce the sources of waste, a big new motorway rather than plan for smarter growth, another hospital rather than ask what is wrong with our lifestyles and eating habits. In this endless quest we have chased our tails to the point of collapse and exhaustion — and we have strip-mined and damaged community in the process.

    It sounds rather glib, but the answers to many of our problems are right beneath our noses. We have become so focused on traditional growth models that we fail to see the less glamorous but simple, cheap and achievable solutions right in our own back yards.

    There are many great new ideas around for job creation in the knowledge economy, and in the hi-tech arena, which will certainly create jobs — but we must include sustainable community economic development using the previously untapped resources within each community to finally end the absurd idea of unemployment.

    The most important area for growth in our society today is in creating safe happy sustainable communities where local ownership and pride is high — and where, for young people, it is a viable option to stay in their hometown. We can create full employment — or as the "Mayors for Jobs" forum recently called it the "zero waste of people" — in five years. And this can be done by restoring the "ecology of community" through sustainable community economic development.

    Source — "Full employment in five years —sustainable community economic development" by Warren Snow, special to The Jobs Letter No.135 1 December 2000

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