We don't need to create more jobs. The government tells us that we have record low unemployment, that our unemployment rate is lower than Germany's. We will have a shortfall of 195,000 workers within 20 years.

But is this true?

How can we know what our labour predictions will be when the Australian Bureau of Statistics estimates the numbers of unemployed from a sample of 30,000 households per month. The respondents who say they are studying or did an hour of paid or unpaid work are not considered unemployed.

Seriously, I think we need to create more jobs. We need to make it easier for people engaged in seasonal labour, like a lot of Australia's food harvest, to have income support schemes to ensure they have a decent standard of frugal comfort through the whole year.

Paul, it may be true that "about 70 per cent of new jobs are created by small and medium businesses" (I've seen lower figures), but this tends to be on the back of wealth created by large businesses. The programs you mention were very small-scale in terms of overall job creation, and even if they were effective, would make little difference. We have to look at "bigger picture" issues which can affect employment on a larger scale.

In general, that means government policies across a wide range of fields which facilitate the generation and retention of wealth, which foster entrepreneurship. This needs to be on two levels - exposure to competition, which is the main driver of innovation and productivity growth; and regulatory, tax, IR, education and infrastructure policies which make entrepreneurship attractive and profitable. Too often government policies act as a disincentive to risk-taking, make it more difficult for businesses to get off the ground and profitably employ people, and claw back too much from successful businesses in tax. We need pro-growth policies to generate sustainable employment.

Paul,

Great article!

Your observation of the beat-up over supposed IT skills shortages in 1999 strkes very close to home for me.

Yes entrepreneurs are the future. Local small and medium business is more responsive to its customer base than large, and multinational corporations. A move toward decentralised government would also be a plus. A large central government tends to be wasteful and unresponsive to the average person who does not have millions of dollars with which to buy influence.

Of course if government actually encouraged the self reliance of local government and entrepreneurship, it would lose its power. Ultimately power and control is what bureaucracies are aiming for. That is why government never gets smaller or more responsive.

The average person needs to take more control of their own destiny and not look for someone else to hand them their livelihood.

How do you inspire someone to self reliance? If I ever have the answer to that question, I'll be on the lecture circuit, making lots of money, inspiring others to come up with their own answers.

Hi all,
1. yes - 70% is the highest estimation, there are various figures with this regard.

What I would consider as 'in', in aprticular, are young companies - like, the Boost Juice and ABC Childcare centres - not small anymore, but quite young - result of recent entrepreneurial effort

1. The programs you mention were very small-scale in terms of overall job creation, and even if they were effective, would make little difference. We have to look at "bigger picture"

no, and yes;

no:
seeds are always small.

yes:
yes, we need to look at the 'bigger picture'.

Yes, there is number of macro-economic factors, that facilitate or inhibit entrepreneurship, but

Bigger picture is created by thousands of small pieces.

yes, every program mentioned is small - that's why we need thousands of them.

huge scale jobs creation does not work any more. What works are community based entrepreneurship programs. For instance,

Ernesto Sirolli states that:
>> a facilitator in a township of 10,000 sees 150 to 160 clients a year, assists the creation, expansion or sustaining of 25 to 35 businesses that foster 25 to 60 new jobs per year.

and a manager of one of Australian Business Enterprise Centres confirms:
>>These figures by the way are substantiated by our own local experience. In our small regional area of three shire councils (16,000 people) assisted the creation of over 550 new jobs in 12 years

The economic impact for a community is at an average of say 40 new jobs each with a minimum income of $35,000 = $1.4 million. The government income tax and GST collection and its is likely to be a minimum of $400,000 per year.
It pays for itself <<

3. We need pro-growth policies to generate sustainable employment

yes, indeed - that's what I am advocating;
what I am saying, is that we can not limit it to creating favorable environment for EXISTING businesses.

this just favours incumbents, and does little (although statistically significant) to foster business growh

we need active policy in the area of entrepreneurship facilitation

yes we do need to make choices that promote employment.

Yesterday I met a bloke who is 45, was a technician retrenched from Telstra 10 years ago, whose current income from a charity is $300 per week. He is living with his brother also in his 40s doing emergency teaching, getting 3 days per week in term 3. This articulate healthy man should be engaged in society but instead he is now a fringe dweller.

A classic example of how to promote employment was when Melbourne introduced ticket machines, the tramways and railways got rid of ticket sellers, guards and conductors. The ticket machines are expensive to run, the NAB collects the money and the software was written by Arthur Andersen - who didn't even write Y2K compliant code in 1995. That means income has been shifted from thousands of low paid workers to 2 corporations, one a bank and the other a multinational with a very tarnished reputation. ACTU statistics suggest that 55% of retrenched workers never work again. The transport system is now unsafe and unused after dark.