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A handy little report lobbed into The Echidna's in-box yesterday, fleshing out the link between the housing and labour shortages. Produced by housing advocacy group Everybody's Home and think tank Impact Economics and Policy, it looks at five regions across Australia and the links between the lack of affordable housing and the difficulty organisations and businesses have finding staff. The report analyses labour and housing market trends since the pandemic in the Sunshine Coast in Queensland; Geelong and the Surf Coast in Victoria; Illawarra and South Coast in NSW; the Fleurieu Peninsula in South Australia; and Launceston and the North East in Tasmania.
Its findings are stark, joining the dots between the two crises. "A lack of affordable and secure housing options limits the ability of workers to easily move between regions and undermines the efficiency of the labour market," it says. In Geelong and the Surf Coast, the report says, there is one house available for every 10 jobs compared with one house for every six jobs in Melbourne. In the Illawarra and South Coast, there is one house for every eight jobs compared with one house for every five in Sydney.
Pointing to steep increases in rents and rental stress across the five regions, the report also estimates the opportunity cost to local economies of the lack of available housing. ln the Sunshine Coast, it puts it at an annual loss of $786 million per year in economic output. In the Illawarra and South Coast, $642 million; $201 million in both the Fleurieu Peninsula and North East Tasmania, and $760 million in Geelong and the Surf Coast. As job vacancies rise, rental vacancies decline. One example: "Since March 2020 the number of job vacancies on the Sunshine Coast has more than doubled, increasing by a total of 2263 positions. Over the same time the number of rental vacancies has fallen from 874 in March 2020 (1.4 per cent vacancy rate) to 419 (0.8 per cent vacancy rate) in June 2022." One shortage mirrors the other and the whole economy suffers.
It's a depressing reality clearly not lost on the Treasurer Jim Chalmers and his mentor Paul Keating. They were both at a Superannuation Lending Roundtable earlier in the week, where they were urging super funds to direct some of their investment into two key areas of Australia's future: energy transition and housing. Keating, as always, summed up beautifully the social obligation he thinks rests with super funds: "This is a society that can't house its own children. If super funds just think they can go buy tech stocks in America and highways in Italy they're gonna run into trouble. Without being heavy-handed there is a requirement of the funds to look at social opportunities."
Without - excuse the pun - labouring the point, we cannot expect to fix the skills shortage without fixing the housing shortage. Nor can we build the houses we need without the builders and tradies who put them together.
HAVE YOUR SAY: How would you fix the skills shortage? Have you had trouble getting a tradie to work for you? Have you or members of your family been caught up in the housing squeeze? Email us: echidna@theechidna.com.au
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IN CASE YOU MISSED IT:
- The Defence Minister has overturned a ban on military and public service staff from engaging in some "woke" charity, cultural and diversity events. The ban was imposed by his predecessor, Peter Dutton, in May last year. Richard Marles instructed Defence that the previous directive, unofficially known as the "morning tea ban", be lifted immediately allowing staff to hold local activities to recognise upcoming Wear it Purple and R U Okay Day.
- Scott Morrison's covert appointments to a host of ministries were valid, but the secrecy surrounding them "fundamentally undermined" the principles of responsible government, the solicitor-general has found. Prime Minister Anthony Albanese has announced a fresh independent inquiry will be launched into Morrison's appointments, after releasing advice from Solicitor-General Stephen Donaghue on the implications of the former PM's secret ministerial power grab.
- For the first time, the German Luftwaffe is participating in the multi-national Pitch Black warfare exercise in north Australian skies. Travelling to Australia as part of the Rapid Pacific deployment, the Luftwaffe arrived in the Northern Territory earlier this month with more than 200 personnel, six Eurofighter Typhoons, three A330 multi-role tanker transports and an A400M transport aircraft.
THEY SAID IT: "A strong economy causes an increase in the demand for housing; the increased demand for housing drives real-estate prices and rentals through the roof. And then affordable housing becomes completely inaccessible." - William Baldwin
YOU SAID IT: Just how to tackle the skills crisis is engaging minds for next week's jobs and skills summit. It also has the echidnas talking.
Jan, the CEO of RSPCA Tasmania, points to another shortage: "You can add vets to the list of professions in short supply. We don't have our own vet, and we are sometimes waiting up to a week for an appointment with one of the local vet surgeries. And this is a global problem."
Jenny says we're on the money with one observation: "Bravo for this comment: '... but how does that response play into the other big problem Australia faces - the housing crisis? Where would these skilled migrants live? Regional staff shortages have been fuelled by a lack of affordable housing for would-be workers. Making one crisis worse with a quick fix for another makes no sense.' Exactly." Thanks, Jenny, that's why we delved further today.
Alan reckons increased productivity shouldn't be expected of workers alone: "I find it interesting that capital in Australia has little difficulty in rewarding top management with increased remuneration without external interventions but by and large waits for some form of regulatory intervention before increase labour's remuneration. So much for the free market and capital's commitment to increasing productivity."
Tim says the solution is simple: "Pay a decent wage and you will get staff. Everyone I know in hospo has not gone back as they got paid more in essential service work. It is transparent they want slave labour wages. Why would you willingly agree to that? Even people on permanent residency visas who fill a lot of service roles are becoming harder to get or not available."
Bob says: "John Hanscombe raises the conflict between increased immigration and the housing crisis. The former economics editor of the SMH, Ross Gittins, called immigration the cheap and nasty way to grow an economy. He explained why in several articles and lectures. Looking back, it is remarkable how prescient they were. Patching over problems with immigration absolves us of actually solving them. It just allows us to lurch to the next skills crisis. Economists and demographers tell us that economic growth demands a certain ratio of young to old, but the young eventually grow old, so that is an upward population ratchet with no end point. In the long term, it ensures an unwinnable conflict with Australia's fragile environment. Is Canberra's ever-increasing population making it a better place to live? Tell us what you think."
Another Jan has a compelling theory: "The crises Australia is facing economically need to go back further than the media has so far canvassed. A large part of the problem lies in the casualisation of the workforce and insufficient taxes collected from the ultra wealthy. Casuals can be paid less in actuality with many employers breaking the law. Casuals have less power to bargain for shifts or pay, tend to be deprived of holiday and sickness benefits etc. When this applied to uni students delivering pizza, it was less of an overall problem. With the extension of the gig economy to include professionals like nurses and teachers, the problem became enormous. Let's get rid of this problem at its source in the one area over which the government has total control - the public service. Let's also make it illegal to casualise full-time jobs."