Katherine Ziesing | Canberra
The headline figures for the recapitalisation of a suite of major Navy assets are impressive. The Future Submarine at $50 billion, the Future Frigates at $35 billion, and OPVs at $3 billion. And this doesn’t account for the billions in sustainment dollars that will be spent over that same period to keep the fleet in being in service while these new capabilities transition to their RAN owners across the decades.
It also does not take into account the wide range of enablers that sit along the headlines – the other Fundamental Inputs to Capability (FICs) that support the asset in the water, allowing it to actually be a capability.
It has reached the point where the rhetoric around people has become passé
Of the nine FICs that Defence recognises (personnel, organisation, collective training, major systems, facilities and training areas, support and now industry) perhaps the most overused is that of personnel or people.
How many times have you heard the words ‘People are our most important asset’? No strategy document or annual report in either Defence or Industry would be complete without these sentiments. It’s a given in the modern workplace. You’ll find these words across virtually every industry nowadays.
It has reached the point where the rhetoric around people has become passé. Where a workforce is an amorphous group of people that will form a capability to support a business case or wider strategic organisational aim, that human capital will move from one region or country to another to follow the job they want.
But this just doesn’t happen automatically. As seen on P82 of this edition, people aren’t nearly as mobile as once thought, nor do they stay in a single industry for life. According to the latest figures from the HILDA report, Australia’s job mobility is a long way from job for life – in fact it’s closer to three jobs per decade! But many will stay in the same location, particularly blue collar workers.
Today the national average tenure in a job is 3.3 years, based on voluntary turnover of around 15 per cent per annum. If this plays out consistently in the life of a school leaver today, and assuming they start their working life aged 18 (in a part-time role) and are retired from all work by 75, they will have 17 different employers in their lifetime. Based on three jobs before upskilling or career changing, this means that they will also have five separate careers in their lifetime.
There are both practical and theoretical reasons to be wary of relocation as labour market strategy. Practically speaking, relocation is not an option for most job seekers.
The most important issue is the interaction of labour markets and housing markets. In places offering a range of skilled jobs, housing prices and rents are higher than they are in places with fewer jobs and less demand for housing. In places that are shedding jobs (Geelong, for example), house prices will be falling, so job-losers who sell to relocate are likely to absorb capital losses. Renters will face higher rents and difficulty finding suitable accommodation.
Consequently, jobseekers facing a move to a place with higher housing costs often discover they are better off – both financially and socially – by staying put and working in a less skilled and less well-paid job. This was the experience of former textile workers in Camperdown and Warnambool in the early 1990s, former energy workers in the Latrobe Valley in the 1990s, and former Ansett Airlines workers in Sunbury in 2002.
So where will the future Defence maritime workforce come from? In short, anywhere and everywhere as long as the work is interesting and the destination is liveable because workers will have to move to be part of the national shipbuilding plan.
The Federal Government has made the decision that the majority of the shipbuilding work will happen in South Australia. Regardless of the politics behind this decision, it does give certainty to those involved.
South Australia has the worst jobless rate in the country, with unemployment increasing on both trend and seasonally adjusted terms, with the latest figures from the Australian Bureau of Statistics showing that the state is a good two percentage points above the national figure. South Australia needs Defence shipbuilding. It needs the workers who will have to come, who will have to live somewhere, who will have to educate their children, and workers who will have to pay state taxes.
Getting the right people, in the right place at the right time requires a national effort.