Tonight Kevin Rudd made an economic argument as to why he should be re-elected. He said that he saw his job as “doing everything I can do to protect your job”. He then went on to describe the stress and tension he experienced during the GFC.
Protecting jobs was one of the initial justifications for the massive stimulus packages that were announced in 2008 and 2009. Treasury official David Gruen explained the logic in 2009. “The first, and most obvious, benefit is that involuntary unemployment is lower than it would otherwise be. Among other things, lower involuntary unemployment implies less long-term unemployment and hence less skill atrophy and less general disaffection with society on the part of the long-term unemployed.”
This has long been the government’s claim - it saved jobs. The question is whether that claim is true or not. In 2012 the government made the claim: “More than 750,000 jobs have been created in Australia since the end of 2007, while around 27 million jobs have been lost across the world over the same period”. In a letter to The Australian in July this year Brendan O'Connor claimed that figure was 966,000 compared to 27 million lost.
The problem is in comparing the number of jobs “created” in Australia to the 27 million “lost” in the rest of the world.
Allan RM Jones has explained the problem. We have to compare like with like. The 27 million figure comes from the ILO - it represented the increase in the the number of people who are unemployed since 2007, including new entrants to the labour market who might be unemployed.
The appropriate comparison then isn’t the increase in the number of people who have jobs, but rather the increase in the number of people without jobs. That figure increased by 222,000 (seasonally adjusted) between December 2007 and July 2013 (ABS cat. 6202.0. table 2).
By that measure it isn’t at all clear that Kevin Rudd has “protected” jobs.