by vivian Hutchinson
vivian Hutchinson is the Community Adviser to the New Zealand Mayors Taskforce for Jobs. He is also the editor of The Jobs Letter, a trustee of The Jobs Research Trust and co-founder of the Employment Catalyst Fund. This paper is based on his keynote speech to “A Future That Works — economics, employment and the environment” conference held on 8-10 December 2004 at the University of Newcastle, New South Wales, Australia.
Thank you for your introduction, and your hospitality. I bring greetings from New Zealand, and from the Mayors involved in our Taskforce for Jobs ... and in particular greetings from our chairman, the Mayor of Christchurch Garry Moore, who had hoped to be at this meeting today.
I am here because I don’t want to live in a New Zealand that has no use for a large number of its young people.
Despite the good employment news at the moment ... it is clear that we are still leaving too many young people behind.
Our disconnection with this large group of young people doesn’t tell us so much about the young people and their skills and capabilities ... but it tells us a lot more about ourselves.
It tells us about how we are managing the interests and assets of our communities. And it tells us about the choices that our communities are making, or not making at this time.
I have been working on youth employment issues since I was, myself, a young person. I have seen the work schemes and work co-operatives of the 1970s ... the enterprise programmes and economic reforms of the 1980s ... the dark decade that coincided with re-organising the public service in the 1990s ... and now to the relatively good times that we are enjoying in New Zealand under a Labour-led government.
So I come here to Newcastle wearing many hats. I’m here as a community activist from New Zealand. I’m here also as the executive editor of The Jobs Letter ... which some of you tell me you have been reading for as long as ten years. I am also here as Community Adviser to the Mayors Taskforce for Jobs .... which I will be telling you quite a bit about later on this morning.
But I am aware that I am opening a university conference on research and trends and analysis on employment and macro-economic matters. And this conference has a special focus on environmental economics and questions of sustainability ... all areas which I take a special interest in.
... so the hat I will be wearing most over these next few days will be that of a learner.
We can’t start this conference, which is also a national unemployment conference, without celebrating the fact that our economies are doing quite well in creating jobs at the moment. Back home in New Zealand we have just announced a 3.8% unemployment rate which amounts to about 79,000 people on the official unemployment list.
This is not something any of us in New Zealand could have predicted at the start of this year. It was only last year that we broke the 5% barrier and got our figures under the official level of 100,000 unemployed people.
But it is not just New Zealand ... we all seem to be doing well at the moment. The unemployment rate here in Australia is down to 5.3%, and in Britain it is down to 4.6%. These figures are at their lowest levels since the current way of counting the unemployed was introduced back in the early 1980s.
I know we can argue the toss over these figures. Our chairman Professor Bill Mitchell today has already described the official unemployment figures as “grossly misleading” ... and I have followed the work of CofFEE and it’s own alternative measures of unemployment. In New Zealand, we have also regularly published alternative employment statistics in The Jobs Letter. So I know there are still many people who are out-of-work and want a job who do not get into the official figures. And I know we can argue the toss about the quality of the jobs that are being created.
But lets not lose sight of the fact that – however you count the figures – they are moving in the right direction at the moment. We are doing well with job creation. This is not an illusion. This is actually a good time to be working on these issues because there are obviously plenty of job opportunities available.
So I certainly believe it is appropriate to take time at this unemployment conference to “raise our glasses” and celebrate what has been achieved.
I was doing just that a couple of weeks ago when we had a trustee meeting of the Jobs Research Trust, the New Zealand community group which publishes The Jobs Letter. At our evening dinner, we “raised our glasses” to the fact that we had just published a 3.8% level of unemployment. Our economy is hot. Our Finance Minister tells us that economic growth is now running at 4.7%, and it will bring us an economic surplus of $6.5 billion.
Later on during the dinner, one of my fellow trustees turned to me and asked: “Vivian, do you think this level of unemployment is going to stay? Do you think it is sustainable?”
I said I could better answer that question if I was much more certain about what it is that is driving these good times. But I am not certain at all.
We are surrounded by metaphors — there is “heat” in the economy and “the economic tide is coming in” — but when I look for specifics, everyone seems to have a different reason or explanation for why we are doing so well.
The government says that these good times are the result of their very careful economic management. And they deserve credit for that.
The opposition parties argue that we are just now reaping the rewards of the economic reforms of the 1980s and 1990s when they were driving the new policies.
The farmers tell us that it is being driven by high global commodity prices.
Other commentators deduce that the good times are the ongoing effect of new technologies and the effect of the internet on the global economy.
Other people say that it is a consequence of a lot of money in the system at the moment because of the War on Terror and Iraq and the debt-based spending in America.
Still others point to China and tell us that it is finally waking up and making its presence known as an economic super-power. Or it could be influenced by the expansion of a huge middle class in India.
I don’t want to disparage the good news ... but I think it is important to reflect on the fact that there seems little concensus on what it is that is driving growth in our economies.
It’s a strange thing with this global economy: when we have high unemployment or trade deficits or other things we don’t like, the regular commentators tell us that this is an economic “fact of life” that we will just have to live with and manage around it. We are told that in the global economy no-one is really in charge ... and no-one is really to blame for anything.
But when things go well ... these same commentators and chatterers are quick to tell us that the good times are the direct result of their preferred policies.
So ... is it churlish amidst the “raising of glasses” to look at our current good times and ask: are we all taking credit for the tide coming in?
If we have no clear understanding of what is driving these good times then we are really in no better position than having a good day at the casino.
We are certainly no closer to answering the question of whether this is sustainable or not. And are we going to find ourselves standing by and watching the tide just as inevitably go out again?
Let’s put our glasses down and take a closer look at these “good” numbers, anyway.
You see, in New Zealand there was a time — only twenty years ago — when we thought that even 79,000 people unemployed was a cause for outrage, not celebration.
Perhaps one of the major political outcomes of the 1990s is that we have come to simply accept high levels of unemployment and wasting the potential contribution of many fellow citizens.
This is a cartoon from Britain in the mid-1990s that makes this point. At the top you have Ted Heath and Willie Whitelaw in the 1970s under a huge dark cloud after reading the news that unemployment is tipped to go over a million people. On the bottom you have John Major and his deputy Michael Heseltine patting each other on the back because they have got unemployment down to 2.2 million people.
The good news is all relative, isn’t it? Of course it is great news that the unemployment numbers are coming down. But perhaps the real political task on employment issues today is to regain and preserve the generational memory of what our expectations should really be.
Throughout this conference I understand there will be a screening of the New Zealand film “In a Land of Plenty” by the documentary-maker Alister Barry.
Barry’s view is that in New Zealand, from the 1930s to the early 1980s, “full employment” was the main objective of economic policy. His film argues that, from 1984, unemployment was made an instrument of economic management ... with immediate tragic consequences for a large number of New Zealanders, and an ongoing legacy of impoverishment of opportunity for the generations to follow us.
When I first watched this film, I was reminded that in 1985, just after the reforming Labour Government got in, I was invited along with many other community leaders to our Parliamentary Beehive building to an Employment Promotion Conference which was the most extensive and high-level public summit ever held in New Zealand on the jobs issue.
At this meeting, unemployment was officially acknowledged as a crisis. The number on the unemployment register at the time was about 50,000 people.
But New Zealand is a small country, and we are a small cork bobbing around in the global economic waterways. And because of this ... things can change quickly. Our Statistics Department tells us that we have created 56,000 new jobs in the last year alone, and most of them were full-time.
Today the public and political focus in New Zealand is shifting from unemployment and onto the concern about skill shortages. When we started the Mayors Taskforce for Jobs the main motivating problem was the joblessness of our young people and the slow economic growth in the regions. Today, the Mayors tell us that their main concern is finding enough skilled people for the jobs that have been created.
Yet unemployment and skill shortages are two sides of the same coin ... they are two sides of a problem that is more about our capacity to make longer-term investments in our own people and their skills.
You can’t really blame young people for not having the skills that are needed in today’s labour market. We really need to see the skill shortages as a crisis of longer-term governance in both the private and the public sectors.
Skill shortages don’t just come out of the blue. By the time they arrive in our communities they are labour market problems that are already ten years old.
They are the consequence of us not investing — ten years ago — in the next generation of our workers.
We know that during the last 20 years many larger businesses — and government departments — got out of doing training in order to cut their costs. Businesses started to gamble on the chance that the skills they would need would just “turn up” in the future ... or they would buy them in from overseas. The whole focus was on getting a good short-term bottom line. And we all knew that this was a strategy that couldn’t ever last.
So now we need these skills, and we need the young people to be interested in upskilling themselves to fill the opportunities that are available. And we are all scrambling to keep ahead of the incoming tide.
The Australian government has just made an announcement that it is putting $1 billion over four years into skills and training. This funding is in addition to the $2.1 billion already committed to support vocational education and training and to support the record numbers of New Apprentices. And the new funding will include the creation of 24 Australian Technical Colleges to provide trade training for about 7,200 students over four years.
This is all good news and good politics. But it may well be too late for training needs of the current crop of young people ... and too late for the skill shortages that businesses tell us that they have right now.
But let’s pull apart the New Zealand employment figures for a moment ... and take a look at just who has been getting the jobs in these good economic times.
The Jobs Letter has been following this for some years now, and every three months we publish the “Who’s Got The Jobs?” summary on our website. In this summary, we compare the statistics for people who were in work in June 1998 (the time when the recovery in employment levels started to take off) ... with the most current statistics.
The latest figures for September 2004 show us that despite young people under the age of 25 making up about 45% of the unemployed, this age group has only taken up 8% of the new jobs since June 1998. Most people will be surprised to learn that two thirds of the jobs created since 1998 have gone to people aged 45 years and over.
Basically, you can see that the big winners of the best job creation that we’ve had in a generation can be found in my own age group and above.
This tells us something about business. It looks as though our business leaders are going for the easiest and most immediate staffing solutions. They are preferring to employ the older workers who come with their skill levels and work attitudes fully in place. Or they are happy to “buy them in” from a global labour market ... rather than taking the slower and more difficult option of growing the skills at home.
The figures also tell us something about our culture. We are not doing the best job we can for our young people. We are not getting the transition right between our education system and emerging opportunities for good paid work that are there in the present economy.
And getting this transition right — what I prefer to describe as staying in connection with our young people — may be one of the most important political and community imperatives of the next generation.
We do all exist within a global economy now ... and our cleverest young people already know that they can operate in a global job market. This international job market is changing the nature of our communities more profoundly than most people realise.
Last year our government published a report on “Population and Sustainable Development”. In that report, they quoted OECD figures which show us that, over the next 25 years, there will be 70 million people retiring from the workforce in the OECD countries. They will be replaced by only five million people. The working age population in the OECD countries will therefore drop by 65 million people.
This is going to happen at the same time that every one of these OECD countries is expecting and planning for a growing economy in order to maintain the lifestyles to which we have become accustomed.
Now this is a megatrend that everyone in positions of governance needs to take notice of. To get a sense of its significance you only need to compare these figures with what happened over the last 25 years when only 45 million people retired from the OECD workforce, and were replaced by 120 million people.
We are already seeing the effects of this trend as our own young skilled professionals — from teachers, to doctors, to tradespeople like carpenters and plumbers and electricians — head off overseas to take jobs that are offering better salaries and conditions and opportunities for advancement that we just can’t match at home.
It’s no new thing — it’s been happening for some years. But this trend is going to escalate and it will cut a very precise swathe through the local skilled workforce in every one of our communities.
Whether you are New Plymouth or Newcastle, your most talented young people — the best investments you have already made in your own future development — will have every incentive to leave and chase better opportunities somewhere else.
There is another face to skill shortages, and this is seen in the fact that so many people are choosing to work much longer hours. Perhaps one of the key questions to be asking ourselves is: How much is our economic recovery being driven by people working harder?
The Australian Institute has just put out a report on this which shows that Australia is at the top of OECD countries in terms of average working hours per year.
Now we used to think of the Japanese as being notorious for being compulsively hard workers ... they even have a word (karoshi) for death caused by overwork.
But we don’t think of ourselves like that. Yet Australia is at the top of the OECD table with 1,855 hours, just behind the United States (at 1,835 hours), then Japan (at 1,821 hours), and then us in New Zealand (at 1,817 hours).
When you compare the Australian and New Zealand hours of work with our European cousins in Germany and France, the difference is about six weeks worth of work! This means that you could take the rest of the year off from about halfway through November ... and still only work as hard as our European cousins.
Yes ... go home! Stop putting in those long hours. Spend more time with your kids. Enjoy these wonderful beaches you have here in Newcastle...
There has been some research done on this in New Zealand by Paul Callister ... and we have just published an extract of his findings in the latest Jobs Letter.
Callister shows us that the long hours worked in New Zealand in the 1980s were driven largely by poverty ... things like people trying to make ends meet by working a lot of overtime or working at several part-time jobs. But in the 1990s this trend started to shift and the long hours are now largely being driven by the lack of qualified people ... and a working culture that “expects” it of you.
So a big component of this is cultural. And working these long hours will only really change when we make sure there are other options available, and we start to ask each other: Are you working too hard? Shouldn’t you give yourself a break? And are you bringing a younger person into your work or your enterprise, and training them up on what needs to be done?
I realise that much of this conference will be discussing the macro-economic issues of how to get back to full employment in our economies.
In the Mayors Taskforce, we have had very little discussion on the macro-economic issues that you are presenting here, and this is one of the reasons I will be very interested in your papers and presentations over the next three days.
I certainly believe it is important to get the research and the analysis right and come up with our preferred policies at the macro-economic level. But research and advocacy are only part of the package needed to drive systemic change on these issues. My experience tells me that things don’t really change until you also have a cultural strategy that can help bring about the transformations you are researching and advocating.
The vision of the Mayors Taskforce for Jobs in New Zealand has often been described as a cultural vision. We have always seen our goals as cultural goals ... that will only be achieved by igniting a systemic change across many inter-connected sectors and agencies.
The role of the Mayors in the Taskforce is primarily one of cultural advocacy. The Mayors are providing leadership and direction on how achieving these employment goals will lead to the sort of New Zealand that we all would be proud to live in.
A cultural strategy for change isn’t just about getting a set of good arguments into place ... it is also about how you build relationships around a deeper vision.
The way the Mayors are doing this is to forge partnerships with government Ministers and the leaders of government departments, as well as with business leaders and with many community organisations.
Our whole strategy has started by re-affirming that unemployment and skill shortages are essentially questions of governance. And governance has an important influence here because of the fact that youth employment is essentially a social purpose.
It always was. But somehow, in the last 20 years, the governance of our various countries abandoned most of the support structures we had in place in the 1950s and 1960s — things like apprenticeships and cadetships and all the training that took place in the public sector — which were part of expressing this social purpose.
We now realise that we just can’t leave it to the market and the business sector to come up with all the opportunities and support structures that are needed to help young people make the transition from school to work.
You can appreciate the business point of view: getting a young person into employment is something that you cannot necessarily expect to see a direct return from in the next quarter, or even in the next year. And because youth employment is really a social purpose ... it is up to our culture to invest in it. The public and community sector have to get in alongside business and work together to make it happen.
We used to know this. This is how we addressed these important issues in the not-to-distant past ... and this is also how we are remembering to do it again.
A cultural strategy means actively bringing together people of diverse opinions and political views.
You can’t wait for people to line up behind the elegance of your macro-economic theories ... no matter how brilliantly they are argued or presented in well-referenced papers. You have to also get out and build relationships across your communities ... and take the risk of talking to people who may well see things quite differently to you.
This is a wisdom and truth known to anyone involved with community development work. The leadership task here involves the courage to work with differences. You need a certain type of courage to suspend your own assumptions so that you can really listen to other points of view ... and then really try to find enough common ground within which you can start working together.
New Zealand has had a good history of working across political views and diversities when addressing the issue of unemployment.
In 1994, Jim Anderton, former Labour Party President and then Leader of the Alliance Party, called on the National Party Prime Minister Jim Bolger to bring together a multi-party approach to the unemployment issue.
This initiative led to the 1994 Prime Ministers Taskforce that brought out a very detailed report and set all sorts of goals for the country to try and achieve by the year 2000. This Prime Ministers Taskforce was an important signal that we needed to get past the divisive and partisan political rhetoric that was tearing us apart in the 1980s ... and try and work for the best solution for all New Zealanders.
Well, New Zealand did not achieve those Taskforce goals by the year 2000. And, to some extent, this was a prime motivator behind the establishment of the Mayors Taskforce for Jobs when the 2000 deadline expired. The Mayors didn’t want to see our country dropping this challenge. They wanted to keep the goals alive.
And an important aspect of how the Mayors Taskforce is keeping this challenge alive can be seen in how it works with its own diversity. Within the ranks of the Taskforce are a variety of Mayors from very different cities and regions, who are coming to the table with an equal variety of political persuasions.
I will be talking more a bit later on about the Mayors Taskforce for Jobs, and giving you an outline of the partnerships, strategies and projects that we are involved in.
But I wanted to say first that none of what the Taskforce is doing is imagining to be a complete answer to the questions of unemployment and skill shortages in our communities. No-one involved in the Taskforce is pretending that we really know how to address the challenge of creating sustainable employment and livelihood in a global economy.
The Taskforce is really a process ... it is essentially a way in which we are continuing to learn. And in doing so, it is a way by which we are unfolding all sorts of local solutions to these important issues.
In the next month we will get to our own first deadline — 2005 — without achieving our intention of having every young person in New Zealand in education or in a job. Sure, we have made great strides on a bigger journey ... and achieved much more than in previous Taskforce-style efforts ... but we are still well away from getting to our first goal.
Our response to getting to this marker point is to stop talking about goals, but keep the pressure on ourselves and our partners ... by talking about guarantees.
If this Taskforce leaves a legacy, it will not be seen as dates or goals achieved … but rather as an ongoing commitment and living guarantee that there will be decent work and good training opportunities for all young people in New Zealand.
Goals are certainly the important work of politicians ... and they help us all get a sense of the direction we can all work towards. A goal also puts the “stretch” on government departments and on community groups and training and social service providers.
But a guarantee is something deeper than that. A guarantee is delivered by a culture.
A job guarantee for all young people would be confirmation that a real systemic change in what we value has taken place in our culture.
Our challenge is to make such a guarantee a sustainable legacy for future generations. And in doing so, such a guarantee becomes not about a future that works ... but something that we are determined to deliver right now.
NOTES and LINKS
The Future That Works conference was hosted by CofFEE: The Centre of Full Employment and Equity and incorporated the 6th Path to Full Employment Conference, and also the 11th National Conference on Unemployment.
The Future That Works Conference also brought together many professors and academics from affiliated and collaborative research centres in the United States (Centre for Full Employment and Price Stability at the University of Missouri-Kansas City), Europe (CofFEE-Europe at the University of Maastricht) and in the United Kingdom (Cambridge Centre for Economic and Public Policy at Cambridge University). www.jobsletter.org.nz/vivian/gig04.htm, or can be downloaded in PDF format at www.jobsletter.org.nz/pdf/gig04.pdf
CofFEE has developed a proposal for a sustainable path to full employment, which it calls the Job Guarantee program. A major focus of their research work is based on articulating this program, explaining how it works, the urgency of it, and “... the reasons why it is the only way to achieve full employment with price stability, a combination that has evaded most economies in the last 25 years.” More information on the CofFEE Job Guarantee proposal is at e1.newcastle.edu.au/coffee/job_guarantee/JobGuarantee.cfm
Other major CofFEE research programs include work on public sector employment in OECD countries, the development of alternative labour market indicators, family friendly work arrangements, and the development of a large-scale macro-econometric model of the Australian economy.
This film is an excellent overview of the story of unemployment on New Zealand from 1984 to 1999. It traces the close links between monetary policy, the fight against inflation, and the consequential levels of unemployment over this 15-year period.
In September 2000, the Mayors Taskforce for Jobs signed a “Memorandum of Partnership” with the Jobs Research Trust, and is enabling The Jobs Letter to be freely distributed to individuals, community groups, local authorities and government departments throughout New Zealand.
Trustees of The Jobs Research Trust include vivian Hutchinson, Jo Howard, Dave Owens and Rodger Smith. Secretary is Sue Page. Contact: P.O.Box 428, New Plymouth, Taranaki, NZ phone 06-753-4434, fax 06-753-4430, email email@example.com, website www.jobsletter.org.nz
It is the Local That Learns – some thoughts on community governance (1999) available at www.jobsletter.org.nz/vivian/comgov99.htm.
Making Hope Possible – some thoughts on the Mayors Taskforce for Jobs (2000) available at www.jobsletter.org.nz/vivian/mtfj2000.htm.
A Capable Age – some thoughts on the “zero waste” of young people (2002) available at www.jobsletter.org.nz/vivian/youth02.htm.
Spirit of Youth – some thoughts on employment and inclusion (2002) available at www.jobsletter.org.nz/vivian/spirit02.htm.
An Economy of Connection - some thoughts after a Knowledge Wave (2003) available at www.jobsletter.org.nz/vivian/econnect03.htm.
Healing Welfare - some thoughts on philanthropy and social enterprise (2003) available at www.jobsletter.org.nz/vivian/healw03.htm.
Great Ideas, Good Practice - some thoughts on local action for youth employment (2004) available at www.jobsletter.org.nz/vivian/gigo4.htm.
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Great Ideas, Good Practice
An Economy The Spirit of Youth
A Capable Age
Making Hope Possible
It is the Local
Great Ideas, Good Practice
The Spirit of Youth
A Capable Age
Making Hope Possible
It is the Local