Permanent unemployment
The prospect facing up to 2 million people in this country that they might never again have a steady job, or a job at all, is becoming a more and more threatening reality.
Last week the Reserve Bank and the Treasury finally admitted what most people have felt in their bones for some time — that the so-called economic recovery now under way is extremely weak and, more importantly, that unemployment levels around 10% are here to stay for a very long time to come.
Minister for employment Kim Beazley confessed that unemployment was unlikely to return to pre-recession levels of 6% during the first half of the 1990s. Whether it will achieve that at all in this decade is also very questionable.
In fact, employment growth has been essentially flat since late 1991, despite the return to slight economic growth. Even for an unemployment rate of 8% by 1996, growth would have to average 4% every year, a most unlikely outcome, especially considering that this year's budget forecast of 3% will almost certainly not be achieved, as most commentators now accept.
Adding the underemployed — those now working part-time who would prefer a full-time job — and those who would like to find work but have simply stopped trying, some estimates put the real unemployment level at 18%. And when the next recessionary downturn arrives in a few years' time, the average real rates will jump another five points at least.
The 1980s were the "boom" decade of debt and speculation. The 1990s are the decade of mass unemployment, affecting 50 million people in the industrialised world and 500 million in the colonially oppressed countries.
The geniuses of economic rationalism have produced these results by claiming that international competitiveness, deregulation and freedom for financial speculation are the life blood of the economy. In practice that means a big reduction in labour and in costs (that is, wages) for companies that aim to rake in big profits. It is painfully obvious, and not by accident, that high levels of unemployment facilitate exactly this process.
Because staying ahead of competitors requires a leap in labour-saving technology while jobs are slashed, any new increase in output will probably not be accompanied by a significant rise in employment. That gives the lie to comments by Reserve Bank Governor Bernie Fraser that current levels of unemployment are mostly cyclical and will be resolved over time.
The truth is that these levels or unemployment are long term and structural. The internationalisation of capital means that the major economies of the world are increasingly synchronised. The to show any signs of recovery because high German interest rates continue to depress the world market. The Japanese economy is in its weakest state since 1974-5. And Britain languishes in recession.
Only by finding huge new markets — which exist nowhere at present — could long-term growth be achieved in any of these countries. This is a critical turning point. Meanwhile, Noam Chomsky is right to observe the increasing prevalence of Third World conditions in the developed countries in the form of widespread poverty, homelessness and, in particular, the inability to find jobs even by those who desperately want them.