Creating effective local labour markets: a new framework for regional employment policy.

Following the economic crisis of the mid 1970s induced by the oil supply price shock, the Keynesian welfare state came under attack as governments retreated from the commitment to full employment and sought to eliminate deductions from surplus value and increase the profit share of national income. The 3 major pillars of the Post War full employment consensus were abandoned and full employability and price stability became the major economic aims of government. The “full employability” framework advocated market-based outcomes unfettered by government intervention as the major basis for economic prosperity. The market-based solution to regional unemployment disparities is migration of workers in response to relative wage differentials. Finally, the concept of individuality has replaced collective will and the intrinsic rights of citizenship have lapsed in favour of ever increasing conditionality and social controls. The persistence of high levels of unemployment, underemployment and regional disparities demonstrates that the “full employability” approach is incapable of delivering on the promises that were given by policy makers. It certainly has not been capable of providing a path back to full employment. This Report is the culmination of a 3 year research project between The Centre of Full Employment and Equity at the University of Newcastle and Jobs Australia Pty Ltd and was motivated by the objective of developing a new approach to social and economic policy making that is: Capable of delivering macroeconomic stability which we define as true full employment in jobs that meet the decent work standards and price stability; Ensuring regional development is sustainable in social, economic and environmental terms, such that communities throughout Australia have access to the economic and social infrastructure necessary to facilitate full participation and promote wellbeing. This Report presents a new integrated framework for regional development which we consider will be instrumental in achieving these objectives. Specifically, the Report outlines 3 important and integrated policy initiatives: An expansion of the public sector to deliver services and jobs to regional Australia; A new national Skills Development Framework; and Implementation of a Job Guarantee (JG) where the government acts as an employer of last resort by providing employment at a fair minimum wage to all those willing and able to work who cannot otherwise find employment