Abolishing The Dole In Australia
...ployment, or waiting to start some form of employment. To be classified as employed a person only has to work over a minimum of one hour per week, whether it is paid work or not (fisher, 1993,p92). As of April 2003, the ABS reports Australia’s unemployment rate to be at 6.1%. This figure represents around 619,000 people unemployed in Australia as of April 2003(www.abs.gov.au). These figures demonstrate that if the dole was to be removed and no other form of assistance was to be offered, these 619,000 people would be living in poverty, and would create a third world sector, where crime and begging would become a way of life, thus dropping Australia’s standard of living. At present the dole acts as an economic stabilizer in Australia, therefore if the dole were to be removed, it would have critical effects on Australia’s economic objectives. Investments would suffer, and along with that, consumer confidence would drop. EPAC suggests that a 1% rise in unemployment, could, and most probably would result in an estimated loss of around $3-$6 million per annum in GDP, resulting in lower economic growth and living standards (Economic Bulletin No.5, 2000, 23). This graph demonstrates that the dole acts as an economic stabilizer. When the rate of GDP gets to high, the government “dampens” it by giving out less dole so that it decreases back down to a suitable level. If the dole is to be removed, considerably lower labor costs might be put in place and employers would not necessarily employ more workers, thus reducing demand and income dramatically. (Murray, 2003, Lecture) A major cause of unemployment in present circumstances, and a problem that looks like it will plague the workforce in the future, is the introduction of new “labor cutting technology” (Economic Bulletin No.5, 2000, 18). Such devices that go under this category are robots, machines, computers etc. Although this may seem like an easier option to employers because of increased output with only one payment at the start of the devices usage, the technology will break down, and because of their “labor cutting” abilities, will therefore create more u...