Interview with Laura Jayes, AM Agenda
22 November 2023
LAURA JAYES: Yesterday we heard from Michele Bullock and she was warning that there might be an interest rate rise ahead. Not exactly groundbreaking, because we're hearing that from economists anyway. But what is clear is that there is a bit of a concern about wages and of course, inflation is persistent, sticky as they describe it. Joining me now is the Shadow Finance Minister Jane Hume. Jane, thanks so much for your time. What is so clear to me at the moment is that yes, inflation is high and one of the issues that the government does actually have control over is migration and skill shortage. If we've had so much migration, hundreds of thousands of people in the last 12 months or so, and we've still got a skill shortage. There's a problem there isn't there? It's not matching up.
JANE HUME: There is a fundamental problem because of course those huge numbers of migrants put immense demand on our already congested suburbs, on our already overworked infrastructure and unless there is infrastructure that has been coordinated to keep up with that level of inflation, it actually becomes a drag on productivity, rather than an enhancement to productivity. You know, Philip Lowe was the first to point out that wage rises without productivity are inflationary. And while we hadn't got there yet, we're now hearing Michele Bullock reiterate that point of the previous RBA Governor, and in fact we've seen productivity tank under the last 15 months under this government. The last 15 months by about 6.6%. Yet at the same time, we've had nominal wages growth that's been a record in the higher nominal wages growth than in the last 14 years. Still not real wages growth, I might add, because inflation is still high. But that nominal wages growth does seem to be really big compared to the productivity needed to make sure that that's not inflationary. That will of course be of concern to the RBA. They've already flagged that.
LAURA JAYES: Yeah, they have. There's some things that are outside of the Government's control and there's still a lot of overseas influences on inflation if I can put it that way. But migration, is the number one issue surely, what is the Opposition proposing the Government should do about this? Because if there's still a massive skill shortage in construction, for example, we've got all these projects that need to be built, but we're still not getting the skills and the skilled workers in. Something's wrong with the way we are taking the intake of migrants surely?
JANE HUME: Something is fundamentally wrong here. Even the Jobs and Skills Summit, which demanded an increase in migration in order to fill those skill gaps had nothing like half a million in fact, it was less than half of that that they were that they were requiring. And yet it does seem that this number has gone completely out of the government's control. That they have somehow not had their eye on the ball and-
LAURA JAYES: I hate doing this, but is it the number you have a problem with? Should it be lower?
JANE HUME: Well, it's the number without the capacity, it's the number without the capacity to absorb it, and to make sure that they are in fact adding to productivity rather than detracting from productivity. That's really the concern. Look, let me be very clear. A well-managed migration program has been one of the foundations underpinning economic growth and prosperity in our country for decades. But the key there is well managed, and with half a million people coming into our country, congesting our already overburdened suburbs, without the corresponding infrastructure to support them. That clearly is a migration that is out of control.
LAURA JAYES: What does well managed mean? Now, let's try and get down to this. What does well managed mean? Are you saying what I've suggested at the start that that the intake is not matching the skill shortage? We've got, certainly migrants putting a lot of pressure on rents, on home ownership. We can see that in housing prices, but yet companies big and small, are still reporting massive skill shortages.
JANE HUME: That's exactly right. And without a matching system, so that the migrants that are coming in are filling those skill shortages, we're going to continue to go backwards and in fact, we're already in that per capita recession. If it wasn't for those enormous migration numbers, we would in fact, be an economy in recession right now on this government's watch, and that's a real concern. We would like to see a productivity agenda, put in by this government, something that lowers the prices of electricity, for instance. A significant input into productivity growth, rather than putting ideology ahead of a lower energy price agenda. We would like to see competition improved, red tape reduction. Lower taxes, all of these things, improve productivity. But most important and right on the government's agenda right now, is making industrial relations simpler rather than more complicated. Allowing people to employ more people rather than detracting them from doing so. That is well within the government's remit today, and yet it has persisted with its ideological industrial relations agenda that is actually going to detract further from productivity. Without that productivity, we cannot have wage rises without it fueling inflation.
LAURA JAYES: Alright, Jane, thanks so much for that. We're going to take our viewers live to the Premier Chris Minns now he's speaking about last nights protest.