Two-speed recovery a big danger

Carol Brown warns of growing fears that some Tasmanians will be left behind in any post-pandemic economic revival

THERE have now been 27 leaks from hotel quarantine. Since June, up to 16 million Australians have been in some sort of lockdown and state border restrictions.

Treasurer Josh Frydenberg warned we may experience negative growth in the September quarter. Technical recession is defined as two consecutive periods of negative growth and this cannot be ruled out as NSW struggles with the Delta variant.

A lack of leadership from the government has meant Australia’s recovery has been plunged into uncertainty. From delivering jabs in the arm to a longer-term plan for our future, the government has failed and Tasmania will be disadvantaged.

As was shown following what we thought was the height of the pandemic last year, Tasmania quickly rebounded in economic performance. The latest figures from the Australian Bureau of Statistics show Tasmania’s unemployment rate is the nation’s lowest at 4.5 per cent. Good news but no cause for celebration.

Delve deeper and you see we still have one of the highest underemployment rates and lowest participation rates.

So how can we be doing well, and not?

For the sixth quarter in a row, the CommSec state of the state reports put Tasmania in top spot for economic performance.

However, Hobart is the most unaffordable city in Australia, we have the fastest ageing population relative to other states, one of the worst General Practitioner to population ratios, high rates of youth unemployment and endemic skill shortages.

It calls to question, why do we rank so highly?

Two-speed or multi-speed economies describe the situation where different sectors recover or grow at different rates.

It is a phenomenon coined following the Global Financial Crisis to describe Australia’s economic recovery and it may have implications for our future.

As stated by social demographer Lisa Denny: “Tasmania’s workforce is polarised and becoming increasingly so”.

I fear our two-speed economy will entrench this trend.

So, while some sectors are strong and, in a sense, carrying our economy, there are some, that are hampered.

Looking at ABS data, strong gains have been made in terms of employment in the retail, hospitality, and accommodation sectors, which are often used as a proxy for tourism.

Disregarding the current state of our borders, when travellers were able to come to our island state, they came in droves and kick started the engine of our economy.

Despite this, some agriculture, forestry and fishing industries are in strife, with total employment at an almost 10-year low. The absence of overseas workers, China’s trade sanctions on wine, beef and lobster and freight disruptions are hurting.

Manufacturing jobs have been on a downward trend since 2000. Paradoxically, we face skills shortages in this sector, and it is seen as one of the largest barriers to growth.

With a lack of policy direction from the Morrison government it will continue to hamper private sector investment as it increases premiums, despite record low interest rates.

We can describe this as a patchwork of sectors. With some industries doing well, while others may be slower in their recovery or impacted by other circumstances out of their control.

But what will this mean for our future?

Labor has a vision and a plan to reimagine our country and Tasmania is in a position to reap the benefits.

Our economy is small and exposed to external forces. This is unlikely to change but is something that we can take under our wing and use our ingenuity to overcome.

We are home to worldrenowned cuisine, culture, and landscapes. We are unique in our ability to offer a safe and pristine place for people to visit or to migrate.

Tourism can jump-start our economy in the short term, but we need a multifaceted approach. We must invest in manufacturing and green Hydrogen, but also improve educational attainment and access to health.

Unfortunately, there is no one-stop policy to fix all this at once. However, the Liberals have had eight years to address the issues and have failed. Every time Labor has come into government, we have implemented policies and a strategic direction for this country.