Free-trade rollback: Australia risks losing 270,000 jobs

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Sydney Employees
Commuters cast their shadows as they arrive at the Central Business District during the morning rush hour in Sydney July 1, 2013. Reuters/Daniel Munoz/File Photo

A key modelling report has revealed that Australia is at risk of a 2 percent hit to economic activity. It is expected to be a loss of over a quarter of a million jobs and a drop in real wages should the rest of the world keeps shifting towards greater trade protectionism.

The report also mentions a 3.5 percent contraction in global economic growth from any global rollback of free-trade policy. It is expected to result to the loss of up to 270,000 jobs in Australia and an economic loss of between 1.8 percent and 2.2 percent of GDP.

The stark modelling was published in The Australian on Monday. It has been commissioned by the federal government.

In ABC radio, Treasurer Scott Morrison explained that trade means more and better paying jobs. "There's not a country that sits around the APEC table for example, or around the G20 table for that matter, that hasn't benefited from trade,” he said.

Australian Prime Minister Malcolm Turnbull will reportedly push for an 11-nation Trans-Pacific Partnership to be sealed at APEC. It seeks to make trade easier and more profitable for member nations. It does not include the United States after it has withdrawn from the trade pact.

The Aussie leader said free trade was under stress. Australian annual household incomes have jumped by $8,500 due to 30 years of trade liberalisation, according to the Centre for International Economics report.

Last month, an employment hub created by the NSW and federal governments opened. It helps place Western Sydney jobseekers in apprenticeships, traineeships and other careers related to construction.

The Northern Road Employment and Training Hub at Penrith will train jobseekers to work on infrastructure projects. The project is part of the Western Sydney Infrastructure Plan by the NSW and federal governments.

Federal Minister for Urban Infrastructure Paul Fletcher said the plan will ensure Western Sydney capitalises on the economic benefits that comes from building Western Sydney Airport. “The plan is estimated to support 4,000 direct and indirect jobs over the life of the various projects, with the new hub part of the $190 million contract to build The Northern Road upgrade from Glenmore Parkway to Jamison Road,” he said.

Up to 910 full-time equivalent jobs were produced through the Western Sydney Infrastructure Plan so far, with the number expected to grow as work ramps up. The hub is being delivered in partnership with Lendlease.