Challenging economic times call for bold thinking. So how about this for an idea?
Imagine if Australia had an economy that worked for people, rather than one that exploited them.
The Australian Council of Trade Unions (ACTU) has just released a new paper: “An economy that works for people”. The report lays out the blueprint of an economy that puts full and secure employment at the heart of Australia’s economic program.
The paper makes the case that it is high time for an economic reboot that would see the wellbeing of working Australians as a key priority rather than the interests of a few large and powerful corporations.
Right now, Australia’s economic report card reads as a sorry tale for working Australians. The headline rate of unemployment may be low, but that figure does not recognise the poor pay and insecurity of the jobs in which so many people are employed.
Despite the employment numbers, wages are falling behind galloping inflation and the red light is blinking as Australia faces the prospect of economic growth shrinking.
ACTU Secretary Sally McManus highlighted the need for Australia’s economic priorities to be worker focused. “Working people have suffered through nearly a decade of insecure work and stagnant wages, only now to be met with historically high inflation delivering massive real pay cuts,” she said.
Our top economic goal as a nation should be to give everyone the chance to get a secure and fairly paid job. This benefits everyone. That’s what we mean by full and secure employment.
Achieving this will require more than fiddling around the edges, it requires new ways of thinking about how our system is managed, who benefits from it and how to change if for the better. We have put forward today a range of ideas to feed into this discussion.
The paper outlines some immediate action the government could take that would put workers welfare at the centre of Australia’s economic program.
- Instructing the Reserve Bank to pursue full employment in balance with its inflation target, and acting in coordination with the Federal Government to achieve full employment and other macroeconomic goals.
- Implementing a fairer and more comprehensive inflation-reducing policy that protects workers’ incomes, prevents price gouging and tackles the underlying sources of inflation in energy, housing and early childhood education and care.
- Ensuring fiscal policy supports the creation of quality jobs in the public and private sectors.
- Reforming our industrial relations system to allow workers to bargain for their fair share of our national wealth
Author of the paper, Dr. Jim Stanford at the Centre for Future Work at the Australia Institute, explained the report summed up the evidence of Australia’s economic underperformance over the last decade.
That was the decade that a series of three coalition governments was in power, and they were focused on enriching business and helping out their mates in particular industries. They were vilifying unions and trying to discipline workers and keep them insecure.
Dr Stanford highlighted workers’ relatively small share of the wealth in the economy as the key factor underpinning Australia’s growing inequality gap.
“Corporate profits have never been higher as a share of GDP. That’s because the previous government had been bending over backwards to enrich corporations and the investors who own them, while suppressing wages and making sure that workers don’t get a decent share of the pie,” Stanford said.
But what are corporations doing with that money? They are not investing it. In fact, investment as a share of GDP has never been weaker for the past 75 years.
Business investment is essential to innovation, productivity growth and competitivity. It keeps the Australian economy growing and a growing economy is good news for workers.
“Of the hundreds of billions of dollars that corporations earned in profits this year, only 37 cents on the dollar was actually reinvested in new capital, equipment, technology and so on. And this is just like money going down the drain in our economy,” Stanford said.
Sally McManus is focused on making sure workers voices are heard loud and clear.
“We can choose to build an economy which gives a greater share of the national wealth to the people who create it and delivers rising living standards for all Australians.