Unemployment figures are the ultimate economic indicator. They reflect the real-world circumstances of real-world Australians, and directly measure the level of misery inflicted when economic growth slows to a halt. The Federal Government has taken the view that propping up employment is the most important thing it can do in response to a recession manufactured overseas, and it has taken an already-strained Budget deep into deficit to meet that end.
Its strategy has been to support retail and construction, two of the biggest sectors in the economy, and ones with substantial multiplier effects. In doing so it has had the support of most economists, businesses and, it seems, the community. Only the Federal Opposition and some conservative economists have regarded the Government strategy as money ill-spent or, in some cases, as money that should never have been spent at all.
It might be Kevin Rudd’s remarkable luck that saw today’s unemployment figures fall. Everything the man touches seems to turn to gold, while Malcolm Turnbull looks increasingly shrill and irrelevant. But behind the rise in employment is a deliberate strategy, backed by massive spending, taken by a Government that has consistently moved earlier than expected to deal with the impacts of the financial crisis.
Today’s numbers vindicate a strategy developed by Treasury and backed by the most senior members of the Government. Unemployment will assuredly rise higher, probably much higher, but each number in today’s increase in employment represents an individual in work who, all other things being equal, is unlikely to have had a job without the Government’s action.
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