Don't believe the hype. Coal employs fewer people than McDonald's
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Version 0 of 1. The prime minister has repeatedly said that the next election should be about jobs. He has attempted to kick-start a new “economy versus environment” strategy in relation to a coal mining. According to the ABS a huge 0.3% of Australians are currently employed in coal mining. If the coal industry trebled in size tomorrow it still wouldn’t be enough to create jobs for the extra 101,900 people who have become unemployed since Tony Abbott became prime minister. Anyone who has ever seen an open cut coal mine will understand why they don’t create a lot of jobs. Work that was once done by men with picks and shovels is now done by explosives and enormous machines. Economists call such industries “capital intensive” which is another way of saying “doesn’t create many jobs”. Related: Approval for Adani's Carmichael coalmine overturned by federal court The ABS provides clear data on this issue for anyone who is interested: it shows that every $1m in mining output creates 1.02 jobs while every $1m from health creates 8.47 jobs and agriculture creates 3.7 jobs. There is no doubt that building the Shenhua coal mine on the prime agricultural lands of the Liverpool plains will cost jobs, not create them. The biggest and most controversial coal project in Australia is the Adani-owned Carmichael mine in Queensland’s Galilee basin. The federal court recently set aside approval for the mine and the Queensland land court is yet to decide if it is in the national interest. The prime minister has decided to make this project central to his economic narrative. It is a poor choice. Abbott has claimed repeatedly that “green tape” and “lawfare” are holding up a potential 10,000 jobs at his favourite coal mine, even though the company’s own economics expert, Dr Jerome Fahrer, admitted under oath that the figure was closer to 1,500 – including indirect jobs. As the bravado of the PR campaign crumbles against the facts, even the Queensland treasurer, Curtis Pitt, applied a reality check on the project admitting that the mine is not the “be-all and end-all” for the Queensland economy. But even taking Abbott at his word – that the Carmichael mine could really create 10,000 jobs, then it would only take 60 similar sized coal mines to solve Australia’s unemployment problem. Indeed, it would only take 10 more coal mines, each 60km in length, to reduce the number of unemployed back to the level that Abbott inherited in 2013. Surely, not even Abbott thinks that is likely to happen. When the prime minister came to power he promised to shed 20,000 jobs from the public sector. His government decided to let the car industry move offshore and their now abandoned scare campaign over the budget emergency was highly successful in destroying consumer and business confidence. But rather than admit his industry policy and fiscal policy has helped cruel economic growth the prime minister is pretending that rising unemployment is all the fault of the greenies and the courts. If the consequences for the 800,000 unemployed Australians weren’t so significant, Abbott’s fist waving at his ideological opponents would just be silly. But when you consider the social and economic costs of unemployment, his exercise in blame shifting is actually quite alarming. Leaving aside the fact that there aren’t 60 Carmichael-size projects on the drawing board, and leaving aside the fact that not even the owners of Carmichael believe their project will create 10,000 jobs, the global reality is that demand for coal is slowing down, not speeding up. In the past six months Chinese demand for imported coal has fallen by 37.5% and the Indian energy minister has repeatedly stated his goal to import no coal to India in three years’ time. Abbott came to power claiming that economic management was in his DNA. He pledged surpluses and debt reduction and, in his first year in office, to create 1m jobs. In reality, unemployment has risen, GDP growth has slowed, and the budget deficit has ballooned. Related: Look past the statistical comedy – the jobs figures are actually great news | Greg Jericho While the focus groups might assure him that “blaming the greenies” and “wedging labour” are the right things to do, such political tactics have nothing to do with the actual economic problems Australia currently faces. No one outside of Australia doubts that the mining boom is over. No one outside of Australia doubts that demand for renewable energy will continue to surge as demand for coal continues to decline. And only a few people outside Australia think that the best way to create jobs is to harm the environment. The prime minister’s political plan is crystal clear. The problem for the unemployed is that goading greenies is not actually a mechanism for creating jobs. The next election should be about jobs – the job possibilities in health, education, computing, the dairy industry, furniture manufacturing, arts and heritage, the horse industry or even McDonald’s: all of which individually employ many more people than coal mining. |