Charities as drivers of employment, productivity, and growth

If governments were primarily focused on boosting employment and maximising investment in job creation, creating more employment for people in charities would be one of their highest priorities, writes David Crosbie.

As the creation of jobs becomes the central issue for governments, charities are unlikely to be at the policy table. This is both a failure and a challenge. 

There is no argument about the importance of employment. Jobs are good. Whether we are talking at a political, economic, social or health level, we know employment benefits the individual, their families, their communities, and the broader economy. 

Studies in Australia and overseas have found that increased employment reduces: death rates, suicide rates, chronic illness and ill health, substance abuse by the individual and their family including their children, poverty, and homelessness, and it positively impacts many other important life style factors.

Communities with higher levels of unemployment tend to have higher levels of social problems including crime and family breakdown. Economies with high unemployment rates tend to be less productive, less equal and less able to support those in need.

Most of us who have worked with marginalised people understand that employment can be the key that unlocks human potential. People tend to feel better about themselves if they have a job, particularly if they can contribute to supporting others and giving back within their communities. 

It is important to note that not all jobs have the same level of benefit. The impact of jobs on the individual, their household and their community can vary enormously, often dependent on the circumstances of the individual and the nature of the job.

The provision of a well-paid permanent job to a single parent with no other means of support is generally likely to be more beneficial and life changing than the provision of a part-time temporary job to someone in a household that already has a high income level.

This kind of variability in the benefit of employment applies across communities. A community with above average household disposable income is unlikely to benefit from an increase in employment to the same degree that a poorer community might. Employment creation programs tend to have more impact if they are targeted at areas of high need. We also understand that increasing employment in programs that enhance workforce participation like childcare, disability support, affordable housing, etc. can have more impact.

Unfortunately, this kind of thinking about investing where job creation will have the maximum benefit is not always the key principle informing government policy. Some state and territory governments have taken up the challenge with major new investments in social housing and other employment supporting packages. The federal government has targeted unemployed young people in its $4 billion JobMaker Hiring Credit for young people program.

What is clear is that if governments were primarily focused on boosting employment and maximising investment in job creation, creating more employment for people in charities would be one of the highest priorities for all governments. Unfortunately, that is not the approach of most governments.

One of the reasons for this lack of investment in charity job creation is that unlike most industry groups, the charities sector has not been marketed as an employment creation area, even though employment in the charities sector has almost doubled since 2007 rising from 740,000 to over 1.3 million employees in 2019.

Almost every major industry group from alcohol to agriculture, pharmaceuticals to mining, tourism to property development, have very well documented prospectus type documents promoting the flow-on benefits and increased value created through employment in their sector. For these industry groups, marketing their employment numbers and the benefits of that employment is a central part of their promotion and policy advocacy to government. They spend millions on collecting targeted data and ensuring that data is widely understood.

The mining industry is a good example. A CSIRO published report into attitudes to mining found that over 80 per cent of the 8,000 plus survey respondents believed mining creates jobs for Australians and that job creation was the major benefit of mining. According to the latest government data, mining employs less than 250,000 people in Australia. 

The charities sector is a huge employer, over five times bigger than mining, mostly of women, and often in areas that further boost employment opportunity and job readiness. By almost every measure, the charities sector is a key driver of employment in Australia, not only in direct employment, but also in bridging the gaps between unemployed people and their communities and creating employment opportunities. 

Yet if you were to ask the average Australian what the benefits of mining are versus charities, the research tells us that people believe mining creates jobs. In all my experience, the most common perception about charities is that they do good work for people and the environment. Many would mention the volunteers involved in charities, very few if any would mention the large numbers of employees across the sector. 

A little over 12,000 charities employed more than 330,000 staff on JobKeeper this year. This is a remarkable figure when you consider the biggest employers in the charities sector, universities and hospitals, were largely excluded from the JobKeeper program.

Importantly, many of the 1.3 million jobs in the charities sector do so much more than a single job, they are part of benefiting communities, enabling people to realise their potential, creating real value for individuals, families and communities. 

As charities we tend to focus on this work, the positive changes we achieve in people’s lives. Perhaps we have done so at our cost? We tend to be pigeonholed, labelled and filed within this one dimension; we are the doing good sector. 

When we consider where Australia is now as a nation, the need to recover and rebuild from the impacts of COVID-19 and the bushfires, there are few things more important than boosting employment, creating jobs. But if charities are to play a bigger role in Australia’s recovery from COVID-19 and bushfires, we will need to shift the narrative about our sector. 

Charities may lack the self-promotion resources of mining and other industry groups, but they have something much more powerful; a workforce of over a million staff, 3.5 million volunteers and many millions more who benefit through our work. 

Charities are more than the work they do. Charities are drivers of productivity, economic and social change. Our challenge is to convince people charities are key drivers within our economy as well as our communities, that we can and should play a central role in the planning and implementation of the COVID-19 recovery. Most importantly, charities should be central to creating increased employment across Australia.