Coalition over retail like a cheap suit

Dennis Shanahan, Political Editor
The Australian
February 17, 2012

THE government has a problem with people shopping at Fletcher Jones that it can’t seem to address and that is creating friction within the cabinet on exactly what strategy to adopt to address the problem.

The difficulty for the government with people shopping at Fletcher Jones is not that people will be accused of being a boring dag for buying the sensible clothing on offer, as I have by some primped radio princes of the air in Sydney, but that there’s now a no return and no refund policy.

After getting some trousers and a couple of cheap business shirts shoppers are told they can’t bring them back because the last sale is a foreclosure sale, it’s the real deal in closing down sales.

The Australia-wide store, which has been flogging sensible apparel since 1918, is one of several retailers to be put into the hands of administrators in the past 12 months. When the winding up was announced 15 stores were immediately nominated for closure and 61 staff laid off.

Every time someone shops at Fletcher Jones now, or looks for a Borders bookstore, or is surprised when one of the local small businesses has shut down, there is a shudder in their sense of certainty and security.

This sense of insecurity is added to, and amplified, when there are announcements of job losses or trouble at businesses and industries that are familiar or household names: Qantas, Heinz, Kell & Rigby, BHP, Holden, Ford, Alcoa, Macquarie Bank and ANZ. Even the self-made little Aussie icon Dick Smith was prompted to come out recently and bemoan the passing of the Dick Smith electronics stores — which Smith hasn’t owned for years after selling his name — to foreign hands.

It is not just the terrible impact on the people who are losing their jobs in all these announcements, which is bad enough for them and the government, it is the flow-on effect to all those whose jobs may not even be affected or in jeopardy but who feel less secure about their employment.

It’s part of the sense of the world closing in or tightening on workers — voters — who are already affected by rising living costs and the uncertainty of the global financial crisis and the latest threat of international debt leading to even worse economic conditions.

The government appears to be unable to do anything, to be unable to control the job losses, and each announcement makes it worse. This has a sapping psychological effect on confidence and spending with a proportionate impact on retail sales, decisions to buy a house or change a job, which further slows the ability of the economy to recover when added to the well-founded concerns about the impact of the high Australian dollar, fragility in international markets and impact of the carbon tax.

The reaction to the news is out of proportion to the number of job losses but it is real.

Julia Gillard, Wayne Swan and other senior ministers, not to mention local MPs, have all recognised the extent and damage of this job insecurity multiplier through the familiarity of company names losing jobs.

The Prime Minister, also recognising that Tony Abbott has been appealing to these fears and building on dissatisfaction about the carbon tax, has specifically referred to the need to keep the “icons” of Holden and Ford running in Australia.

But when the Opposition Leader talks about job losses at Alcoa, Queensland feels the chill; when Abbott talks about job losses at Qantas and the carbon tax, there’s a murmur of agreement, and any pleasure at getting a cheap shirt at Fletcher Jones is wiped out when the buyer knows the nice lady behind the counter is facing unemployment.

This is a battle about retail politics, about the retail economy and sometimes literally about the retail industry, which the Coalition is winning.

Built on the back of an 18-month campaign against the carbon tax among manufacturing workers Abbott has a head start and is using the spate of headline job losses to reinforce that position.

This week the latest Newspoll survey showed that Abbott is now clearly preferred over Gillard as an economic manager as well as prime minister.

Gillard is losing the argument as leader and Labor is losing the argument as a team.

The Treasurer, who ended up neck-and-neck with his counterpart Joe Hockey, can argue that he’s keeping up his end by being competitive with the Coalition spokesman on economic management when so many Labor economic spokesmen have trailed in an area of traditional Coalition strength.

This is particularly the case when the global economy is in such strife. Indeed, Swan’s main problem with his level of support is the extent to which he has derided and pilloried Hockey so that to come out equal is a loss.

There are government MPs who don’t understand how this can be so and become frustrated when the emphasis yesterday was on 350 jobs being lost at Qantas while the adult male unemployment rate actually dropped below 5 per cent to 4.9 per cent after the creation in a month of roughly 12,500 jobs.

Typical of this imbalance of emphasis was the observation this week of the Japanese ambassador, Kaz Sato, who noted Mitsubishi’s deep regret at the loss of 350 jobs at the Altona plant but praised the signing of Ichthy’s $34 billion liquefied natural gas agreement with Japan that will create 3000 jobs in the construction phase with 700 jobs (twice the Altona loss) during its operation.

Despite this obvious disconnection Gillard, Swan, Bill Shorten and Greg Combet still keep using percentages of unemployment, comparisons with global unemployment figures and macroeconomic arguments about the carbon tax creating a new economy.

They talk about a “journey of change” and structural adjustment with some “companies doing it tough” while accusing Abbott and the Coalition of not caring about jobs or workers. Banal generalities and arrant nonsense.

Abbott’s response continues to be that Labor is engaging in class warfare and is out of touch with small business and the rising costs of industry that a carbon tax will make worse.

Tellingly, as Shorten answered a question as Assistant Treasurer he was provided with figures from the government Whip and almost ever-smiling NSW member for Hunter, Joel Fitzgibbon, about “Coles and Woolies” creating 700 new jobs in his electorate.
Shortly before, at a press conference, Shorten talked only about the Qantas jobs in specific terms and vague percentages when talking about employment.

Abbott’s campaign on the manufacturing floor has worked for the Liberal leader and his concentration on specific job losses in terms people can comprehend is continuing to work for him while the government resists suggestions from its own side to go “retail” and start talking about specific companies creating new jobs, in some cases the same companies announcing job losses in some areas.

Part of the problem is perhaps the poor relations between Labor and industry, particularly mining where the growth is, that the jobs aren’t where people are becoming unemployed and the knowledge that certain sectors will blame the carbon tax and related rising power costs for job losses.