100 jobs: What Adani is really delivering

Those supporting the Adani mine have pointed at the jobs it will create. However, the exact figure depends on who you ask.

 

 

When it comes to the Adani coal mine, Adani has put out so many different job creation numbers, at different times and for different audiences, it’s hard to know what’s what.

Adani comes up with different jobs figures depending on who it is talking to:

  • Adani promised politicians 10,000 jobs;
  • Adani told investors the whole project would be automated from mine to port (meaning robot-driven trucks to reduce on labour costs—i.e.; jobs);
  • in court, Adani was forced to admit it would create just 1,464 new job—direct and indirect jobs—for the mine and railway, because it would negatively impact other industries.

Richard Denniss, Chief Economist at The Australia Institute:

“No one was meant to check whether any of the promises made by Adani were actually deliverable.
“That’s why mining companies and their friends in parliament are so keen to crack down on the use of court cases to examine the claimed benefits.
“Lying to journalists and politicians is a lucrative business for the mining companies and their PR firms, but the reason why these court cases are so significant is that lying to judges is a crime.”

Now the proposed mine is going to be a quarter of the size Adani originally took to that fateful court case, but they are still saying it will create “thousands of jobs”.

We are supposed to believe this magic pudding of a coal mine will somehow create more direct jobs than what Adani said would be created—direct and indirect—across the life of a mine that was originally slated to be four times the size.

One trick Adani uses in its jobs claims is to conflate the short burst of construction jobs with far fewer jobs during operations. But helpfully, Adani supporter Senator Bridget McKenzie makes this clearer:

“(Adani will) be employing 1,500 through the construction phase and around about 100 ongoing.”

100 ongoing jobs.

Some jobs “bonanza”.

 

Fact: coal mining is a relatively small employer, even in North Queensland

Contrary to popular belief, coal mining is a small employer by Australian standards:

  • 99.6% of Australian workers do not work in coal mining;
  • 98.9% of Queenslanders do not work in coal mining;
  • 95.7% of North Queenslanders do not work in coal mining.

Across Australia, coal mining accounts for half of one percent of all jobs (0.5%), that’s half a job out of every hundred.

In Queensland, coal mining is just 1.1% of all Queensland jobs. Coal mining comes in far behind far bigger employers like health, education, retail, agriculture, public administration, construction, as well as accommodation and food services, which are heavily linked to tourism, and manufacturing.

In North Queensland, coal mining is the eleventh biggest industry, accounting for 4% of jobs, meaning 96% of North Queenslanders do not work in coal mining.

Tourism is a far bigger employer in North Queensland than coal mining.

Tourism is a major driver of jobs across a number of different industries, and the Great Barrier Reef is a major attraction drawing tourist to North Queensland.

There are around 40,000 jobs in tourism in reef regions on the North Queensland coast—twice as many as in coal mining, according to ABS data. Other estimates put the number higher at 59,000.

Tourism jobs are put at risk by mining more coal, which will fuel climate change and increase bleaching and coal death at the Great Barrier Reef.

 

Lots of coal does not equal lots of jobs

Mining is also incredibly capital intensive, not job intensive. In fact, there is no industry less job-intensive than mining. So even though Queensland produces a huge amount of coal, it doesn’t produce a huge amount of jobs.

The best thing you can do if you care about workers in existing coal mines is to stop a massive new coal mine from putting them at risk.

Australia Institute Research Director and economist Rod Campbell:

“The subsidised development of the Adani mine represents a threat not just to Newcastle Port but to all mines in the Hunter. With flat world demand, subsidising a large amount of new supply is economic madness.”

This mine is the gateway to the Galilee Basin. It has been scaled back, but once the infrastructure is built it makes the whole basin more likely. If that happens, it will put millions of tonnes of new coal into a stagnant and falling market, and put existing coal mines at risk. The Australia Institute estimates this puts up to 13,000 jobs at risk if the whole Galilee goes ahead, according to The Australia Institute’s research report, The Impact of Galilee Basin Development on Employment in Existing Coal Regions.

Pat Conroy MP, the Member for Shortland in the Hunter region:

“It’s a matter of economic logic that, if you increase supply into a market where demand is falling, you will affect prices. You will drive down prices. You will threaten existing coal mines and existing coal mining jobs, including the 18,000 in my electorate.”

No one knows this better than the Port of Newcastle, the world’s biggest coal port, and Glencore, Australia’s biggest coal miner, both of which have publicly opposed the political support this project has received.

Then-Port of Newcastle executive Jonathan van Rooyen:

“There is no avoiding the simple mathematics that if Turnbull succeeds in pushing between 25 million and 60 million tonnes of subsidised new coal into a flat world market the volume of coal mined and exported from the Hunter and Illawarra will decline.”

Electrical Trades Union state secretary Peter Ong told the Australian Financial Review that Adani had refused to engage with his union and warned the mine was unlikely to provide decent wages or conditions.

Peter Ong, ETU QLD state secretary:

“You open up another coal mine and all it’s going to do is put further downward pressure on the price of coal—and it’s basically flat at the moment—and it’s going to put pressure on the already operating coal mines.”

There’s been a lot of triumphalism about increased coal revenues recently. But Australia coal exports are essentially flat. What has changed is price.

And what’s doing this? The shift away from new coal mines.

As the Chief Economist wrote recently (page 50):

“A lack of substantial investment around the world is expected to constrain supply growth, providing price support.”

Why is that?

“…there is a growing reluctance to commit to new greenfield projects.

“Projects have struggled to attract financing, with a growing list of lenders announcing they will no longer finance thermal coal projects, and pension and equity funds divesting from coal. There is also growing public opposition…”

In other words, the turn away from new coal mines is pushing prices up. And that’s a good thing, for both coal mining jobs in existing mines, and for the climate.

 

$130 billion per year benefit to GDP by avoiding climate change

Maritime Union of Australia Queensland secretary Bob Carnegie publicly opposed the Adani mine, and called on other union leaders to do so, on grounds it would worsen climate change.

“We stand by our mining brothers and sisters in the CFMEU mining division but as Queensland state branch secretary I do not stand by the fact that another coal mine is going to be built to further enrich the world’s CO2 emissions. The world doesn’t need another thermal coal mine.”

As The Australia Institute has written:

Unless national action is taken to meet the Paris Target to limit global warming to less than 2 degrees, Australia’s GDP faces a hit of an average of $130 billion per year according to a new briefing note by The Australia Institute.

  • The cost of inaction on climate change is huge—Australia’s GDP would average $130 billion per year lower if the Paris Agreement is not achieved according to a prominent study.
  • Under the carbon price period, Australia successfully reduced emissions by 2% while the economy grew by 5%.
  • Economic literature suggests the economic impacts of climate policy will be minor.

Rod Campbell, Research Director at The Australia Institute:

“As an economist, it is hard to understand why policymakers are ignoring Australia’s own recent history in climate policy and the clear costs imposed by climate change,” said Rod Campbell, Research Director at The Australia Institute.

“Australians have seen firsthand how emissions reduction and economic growth are possible at the same time—as a nation Australia experienced this very phenomenon five years ago.

“For political leaders to suggest we now need economic modelling to tell us whether this is indeed possible after all is a furphy.

“In just two years Australia reduced emissions by 2% and grew the economy by 5% under a carbon price and the sky did not fall in.

“In fact, employment grew by 200,000 jobs.

“Analysts cannot claim to base their work on the likes of Lord Nicholas Stern or Professor Joseph Stiglitz and then ignore the conclusions drawn by those very same pieces of research.

“Nicholas Stern’s own conclusion was that ‘the benefits of strong and early action far outweigh the economic costs of not acting (on climate change).’

“Similarly, consultant Brian Fisher cites a study that estimates climate costs to Australia of $130 billion per year, but ignores the conclusion of that very same study.

“Analysis that ignores the economic benefits of acting on climate and only focuses on costs is misleading and does a disservice to this year’s voters and future generations.”

 

This piece was originally published on Medium.

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