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Who backs the backing singers in the rock star economy?

First published Friday, July 4, 2014

According to some chap called Paul Bloxham, New Zealand will be the 'rock star economy' of 2014. This dubious claim was given some airing earlier in the year because Mr Bloxham works for a Big Bank and therefore knows about economies and whatnot. The claim also happens to fit with the 'we're all better off now' narrative peddled by the mainstream media as it campaigns to get the National government re-elected. One of the few challenges to this claim came from a Stuff article suggesting most of us were roadies rather than rock stars. This is not surprising. The rock stars are corporates with political clout, not low-income households with overdue traffic fines.

As every concertgoer knows, apart from odd exceptions (solo acoustic sets, Slayer), rock stars also have backing singers. These warblers presumably do their thing, pick up their pay and go home (I'm speculating here). So it is with our economy. The backing vocalists keeping things joined together are cleaning our offices, caring for our elderly, and working on shop floors. Most of them are women.

Sadly things have not been going so well for these un/rock stars in recent years. Most of us are familiar with the statistics: women earn less than men even when they are doing the same work, they are more likely to be unskilled or semi-skilled, and are more likely to lose out careerwise if they are raising children.

About half of all mothers will be reliant on a benefit at some time while they are raising their children. Usually these benefit stints are relatively short, but they can lengthen when the children are very young or a child is disabled, or the mother has limited access to transport. As this blog has noted previously, women have also suffered more unemployment in the endless economic downturn New Zealand has endured since 2009.

Women, specifically women on what is now called Sole Parent Support (SPS), have also been vigorously targeted in the government's welfare reforms. Apparently they are bleeding the country dry, a point which has been hammered home with propaganda about multi-billion dollar future welfare costs. The future liabilities are bogus economics but they provide an alibi for the Minister's regular - and unprovable - assertions that the numbers on SPS have fallen because parents have moved from welfare into work.

There are many reasons to be highly sceptical of this claim but we will focus on only one here, and that is that unemployment rates among women remain well above what they were prior to the global financial crisis. This applies not only to women, but to unemployment generally, but that's a topic for another post. Below is a graph showing unemployment rates for women from late 2007, when unemployment was low, through to March 2014. The data was done by region although only two - Auckland and Northland - have been shown here, as well as the total. What the graph clearly shows is that despite the spin, unemployment went up steeply after the GFC and has remained high. Worse, it is showing signs of trending up again. This pattern can be seen in most regions, with Canterbury and Otago being exceptions. 

In the Auckland region unemployment among women has risen since September 2013 to 8% while the number of SPS recipients has fallen by about 1,000.This raises two questions: if sole parents are being moved off benefits into work, where is the work; and are these women just displacing others in the labour market? Clearly mothers are not 'moving into paid work' because relatively more jobs are being created.

So what is happening to those mothers who are no longer on a benefit but have been unable to find work? We have no idea because although National's welfare reforms have been sold with such great promise, it appears no one is allowed to know whether they are working or even how they are going to be evaluated.

In the meantime we are left with the awkward fact that in our rock star economy, the incomes of thousands of women are increasingly precarious as unemployment refuses to fall and welfare assistance becomes harder to obtain and keep.

Why is no one challenging the narrative that everyone is benefiting equally from the improvement in the economy? One organisation that should be speaking out is the Ministry of Women's Affairs, but...silence. Households that have had $1 billion sucked out of them by the combined ravages of unemployment and welfare reform are not enjoying the after-show champagne.

And why is no one (apart from children's advocates) challenging Paula Bennett's oft-repeated assertion that somehow this is 'good for children'? Because what is happening in some of those households isn't good for anyone.