Shadow Treasurer Chris Bowen recently delivered a speech to the McKell Institute titled Growth, Opportunity and Fairness: A Better Way which got me thinking not only about what the jobs of tomorrow will look like – but how important is it that the Labor Party offer direction for a better fairer way.
Bowen’s speech makes three important points.
First :“We need an economy which is innovative, agile, entrepreneurial and embracing of change.”
This is key. Every successful nation looks to its competitive advantages and capitalises on them. We have lived “off the sheep’s back” and off mining wealth for generations but the time is coming when that will have to change.
In the future, value will also have to come by exporting luxury secondary products. That’s where the greatest profit will be and where the greatest good to Australia’s economy will be achieved. With 630 million middle class Chinese by 2022 looking to purchase luxury items like Penfolds Grange and RM Williams.
We have plenty of well-established industries that should be preparing. Why is it then that our outstanding wool, accepted as some of the best in the world, is milled into fabric in Milan, cut into suits in London’s Saville row and sold back to customers in Sydney’s Castlereagh Street? Why aren’t we producing the world’s finest cloth from the paddock to customer? We will never be able to match Bangladesh at the lower end and nor should we try – but why not aim for the top?
Paul Keating was castigated in the 1980s for wearing Ermenegildo Zegna suits. Tony Abbott and the Nationals should be castigated for not bringing the mills here instead of Italy.
Overseas producers understand the sense of this. Recently, Ermenegildo Zegna announced it had bought a major share of a wool farm in New England so that it could better control its luxury product from raw material to the boardroom. In other words, so that it could maintain Australia’s role as a primary producer rather than as a high-end fabric producer.
Innovation and entrepreneurial vitality is needed if we are to change this model and move beyond a mere producer of raw materials. But this will require vision, energy and the right policy framework from government.
Second: “These massive improvements in technology threaten jobs while at the same time creating opportunities for economies to create jobs and wealth…”
Growing up as kids of the 1980s many of us remember seeing David Hasselhoff fighting crime with his driverless car in the hit TV show Knight Rider. It was the stuff of a little boy’s dreams that is about to become a reality. In less than six months, Britain’s roads will see the arrival of the first driverless cars.
The transport and logistics sector is characterised by relentlessly improving technology. The electronic stability control system, autonomous emergency braking system, and blind spot elimination system. All these innovations have allowed the industry to be more efficient, safer and more productive.
I know the competing challenges of technology and jobs are something close to the heart of the current member for Gellibrand, Tim Watts MP. He has spoken of the challenge innovation brings and how it atomises industries. The end result is a race to the bottom, with more competition at the expense of decent wages and conditions.
Experience shows that with the right policy setting you can create the environment for new industries, new opportunities and new jobs. But it shouldn’t be at the expense of decent wages and conditions.
The renewable energy is a good example. In Australia, more than a million households have solar panels on their roof, in 2000 it was a mere 8,000. Without a firm commitment to the renewable energy target all of this could be lost and the Abbott government will have turned it back on the over 18,000 people and 4,500 businesses, many small to medium size.
The value of the industry is obvious. As the demand grows it will reduce the cost of the technology, reduce emissions from coal-powered energy and at the end of the day save weekly household bills and the air we breathe.
The Australia Institute recently released credible findings that solar is both creating jobs and pushing down electricity prices – contrary to the Abbott government claims that renewable energy puts upward pressure on energy prices.
According to those findings Australia’s biggest existing coal-fired power generators, such as Macquarie Generation and Stanwell, employ only 642 and 800 workers respectively.
Put simply the Abbott governments regressive attitude is risking the opportunities for our economy to grow in this critically important energy sector. It is prioritising the interest of the few at the expense of the majority.
Third: “We need a nation which embraces entrepreneurialism and risk taking. One that encourages venture capital and start-ups. That says to innovative Australian: don’t move to Silicon Valley: do it here!”
It pleases me to see Labor championing the creation of tech hubs.
For five years I walked down City Road to London’s Old Street tube station. Old Street tube station is more associated with the short walk to Shoreditch’s trendy pubs and clubs than start-ups.
But now it’s become a mini Silicon Valley. In 2008, there were around 15 media and high-tech companies in close proximity. By 2010 there were 85 startup companies in the area, by 2011, approximately 200 firms were occupying the district, and Wired magazine updated this figure in 2012 suggested some 5,000 tech companies were located in the area, employing over 10,000 people. The tech hub has taken off.
Many measures are needed to ensure the right climate for technology and entrepreneurialism can flourish. For example, tax concessions for start-ups, tax exemptions for the first twelve months, and seed funding from investors.
A Brookings report published in May confirmed, “a rising number of innovative firms and talented workers are choosing to congregate and co-locate in compact, amenity rich enclaves.”
Australia has a natural advantage compared with many nations and it’s called NBN. It has the potential to revolutionise so many sectors, from life sciences, nano-technology and robotics, to creative industries.
These three key points, taken together, should reassure the public that a positive agenda will improve the economy, improve opportunities and ensure fairness is at the heart of successful economic policy
Labor has always been a party of the bigger picture – Medicare, superannuation, Gonski and NDIS. Now our challenge is to bring this nation changing creativity to the economy. The Shadow Treasurer’s speech is a timely reminder of how a Bill Shorten-led government will begin to do just that.