By John Haly and Dr. Martha Knox-Haly, originally published at Auswakeup Media.

We now go on to part two of our discussion of the concept of a “Mismatched Unemployment Inflationary Rate” (MUIR), which would use a federal job guarantee to bridge the gap between full employment policies and the inflationary risk associated with mismatched skills driving up production costs. We now look at how the components of a full employment policy can offset the inability of western governments to end needless unemployment.

[Here’s a link back to part one.]

When governments do facilitate a full employment approach, it is appropriate to implement an employer-of-last-resort policy. A Job Guarantee can address the inflationary risk that may arise as unemployment falls below 2%. The Job Guarantee can also address educational lag-time (the time it takes to train someone). Instead, in the decades since the advent of proto-neoliberalism in the 1970s, the neoliberal agenda has decimated unions, fragmented labour markets, and deprived workers of agency, rights, skills, engagement, and purpose (Humphrys, 2019. Pg 76-77). The dysfunctionality of the modern capitalist workforce is outlined in David Graeber’s book “Bullshit Jobs” (Graeber, 2019).

Focusing on a regionally driven Job Guarantee should not precede Western economies failure to resolve to labour market wastage. Currently western economies have not even approached the point where the MUIR point is reached (Richardson, 2019). To achieve sustainable employment, we must expand job opportunities in the labour market to the point where the MUIR point is relevant. To understand the actual size of unemployment, we must first measure true internal domestic unemployment in ways other than the subset represented by International Labour Organisation (ILO) guidelines (Haly, 2022).

To achieve employment sustainability and equity, governments must prioritise employment options that meet the needs of individuals and the labour market. Then, when unemployment is low, we address mismatches between individuals and jobs. There will be an inevitable education lag as we retrain people to fill vacancies. Government intervention in the private and public job markets to maximise participation opportunities ensures that the “gap” filled by a job guarantee is quite small. While providing work at a minimum wage for a job guarantee is still required, otherwise misallocated people must continue to be served with pathways to better job opportunities. The Job Guarantee works well when everyone else is fully invested in the labour market’s long-run potential.

Due to a lack of a strong skills base, integrated career plans, and ongoing investment in training, Australia is severely disadvantaged compared to other OECD countries facing a green transition (OECD, 2023). We need better Federal and State engagement in developing National Qualifications Frameworks before we even consider locally-based initiatives for work (UNESCO, 2023).  This is where future job growth will occur, as the labour force requires extensive STEM (Science, Technology, Engineering, and Math) skill training at both the TAFE and university levels (National Skills Commission, 2022). We must make more drastic changes to ensure our species’ survival in the face of catastrophic climate change, biodiversity loss, water scarcity (except when it floods), land degradation (especially when it burns), pollution, and waste. There are local conservation needs, but we must prioritise larger mission-based projects with local support that are funded by the federal government and ultimately guided by citizens (Gould & Mazzucato, 2021).

Sustainable Full Employment

A sustainable foundation for employment necessitates a focus on the components of a sustainable economy. This means sustainability must be promoted at the national, state, and local levels. Sustainable infrastructure projects are typically implemented at both the federal and state levels. Because of the vast geographical distances between Australian capitals and regions, Australians urgently require functional National Broadband, functional national transportation systems, and mega-projects to generate sustainable renewable energy.

The neoliberal zeitgeist portrays the government as incapable, fallible, and unworthy of investing in new industries (Monbiot, 2016). During the postwar decades, Australian public sector industries produced that critical trade workforce. Deregulation of the financial industry is to blame for the pitifully unstructured job market we now face. It means that businesses in Western democracies are having difficulty obtaining the consistent and long-term financial resources required to fund lifelong employment, integrated career paths, and ongoing training investment. So, the process must begin with re-regulating the finance sector and restoring it to its proper place in society, which is in support of the actual production of goods and services.

Skills required for future employment

Work-for-dole programmes, akin to those used by conservative governments, in which employees are forced to rake leaves in the neighbourhood park or remove playground graffiti, should be abolished (Patty, 2014). To achieve a national economic transition to sustainability, significant investment is needed to develop deep-level skills and integrated career paths. Many people should be encouraged to pursue STEM-related careers, skill development, and public employment as that is where future growth is (Steel, 2021). (see Figure 4)

We’re in this predicament because Western governments have long opposed the establishment of an integrated labour market. Their preference is to foster a fragmented labour market conducive to the “McDonaldisation” of employment (Crossman, 2020). This strategy ensnares young people in low-wage positions in the hospitality and service industries, with minimal opportunity for promotion. In the USA, Australia and the UK, this burden is exacerbated by the specific despair of college debt, which shackles people for decades and severely restricts their economic mobility (Sullivan, Meschede, Shapiro, & Escobar, 2019). We must reverse the “McDonaldisation” and fragmentation of our labour markets. We want to demonstrate to job-seekers how their participation in local, state, or federal-level work can fit within the national qualifications framework that most Western democracies can produce. This improves people’s ability to transfer their skills and credentials to more functional work environments. Without the ability to relocate, people trapped in one local community are more vulnerable to exploitation and nepotism. Even if we meet “fuller” employment targets, incentives must be in place to prevent people from becoming trapped in a local job guarantee and seeking alternative careers. If those connections to the National Qualifications Framework are not articulated, The task of cleaning graffiti off playgrounds is valuable to a community, but without credentialing, it is not portable. Many people seek genuine professional opportunities to improve their chances of success and determine where future job opportunities will exist. Governments must constantly adapt public job markets to skill mismatches and provide unimpeded training where needed to limit the population size of a necessary job guarantee.

We need STEM career paths that are technically oriented and integrated, starting on the shop floor and ending in the boardroom. We should develop a technical common language for labour involvement to increase the chances of successful collaboration. Everyone with similar high-level training can understand each other’s concerns, reduce ignorance and build empathy. This training would also alleviate the marginalisation, alienation, and frustration of technical employees servicing a less skilled population.

An employment programme must be robust and flexible, provide ongoing training and educational benefits, and have no entry or relocation barriers. This is how to address the issue of long-term unemployment and better match skills to opportunities. The programme must offer opportunities for deep and articulated skills along distinct career paths, as well as multiple entry points into an integrated labour market. As evidenced by 25 years of Australian history, the inflation risk for reduced unemployment should be well below 2% – everyone who wants a job, or a different job, should be able to get one. So, the Reserve Bank’s claim that 4.5% represents “full employment” and 3.7% represents “insufficient unemployment” is complete nonsense (Haly, 2024a). Significant infrastructure and energy transition projects require employment and educational opportunities at the state and federal levels. We have so much to do, and with the looming poly-crisis, there is little time for the necessary employment revolution (Whiting, 2023).