Showing all posts tagged: economics

Finland abolished homelessness by giving the homeless homes

23 September 2022

Why we in Australia can’t simply to resolve to deal with homelessness in the same way a country like Finland does, defies belief. People say the cost would be too great, but I think it’d be far less than the cost of having people living rough, or in emergency homeless shelters long term.

In Finland, the number of homeless people has fallen sharply. The reason: The country applies the “Housing First” concept. Those affected by homelessness receive a small apartment and counselling — without any preconditions. 4 out of 5 people affected thus make their way back into a stable life. And: All this is cheaper than accepting homelessness.

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Doing anything for a living even dishwashing by Dugald Jellie

19 September 2022

Writers in Australia are often forced to work several jobs to support their craft, something Evelyn Araluen, winner of the 2022 Stella Prize, could tell you. Some of the roles aspiring creatives take on — and washing dishes may, or may not, be among them — doubtless would not be their first choice, but are usually a vital means to an end nonetheless.

Then again, force of circumstance may see anyone end up taking on work they are overqualified for, but need regardless. Melbourne based fifty-something Dugald Jellie writes about taking on dish washing duties at a busy cafe, after finding himself in need of work, any work:

How I got here might be a cautionary tale. The choices we make. A few wrong turns, a misstep, some bad timing, and now I work between four sinks — in the kitchen, front-of-house — stacking plates, hands wet, at the bottom of the food chain, a tea towel slung over my shoulder.

Recommended reading for a Monday morning.

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New Australian Labor government to regulate gig-economy work

29 August 2022

The new Australian Labor government is set to bring reforms to the gig-economy, with the pay rates and conditions of food delivery riders and ride-sharing drivers particularly, who are effectively casual workers, in their sights. Variously referred to as independent contractors, gig-economy, or on-demand workers, the Labor government is seeking to extend them more of the employment rights traditional workers enjoy.

Unlike traditional employees, contractors for gig companies do not have rights to minimum wages, unfair dismissal protections, employer superannuation payments, workers’ compensation for injuries or paid leave. Working conditions in the sector have been under growing scrutiny following five delivery rider deaths in three months in 2020. However, the services have flourished since Uber arrived in Australia a decade ago as minimal government intervention allowed consumers to enjoy cheap and quick food deliveries and more convenient taxi services, and gave gig workers the ability to choose when to work.

Some reports suggest food delivery riders earn little more than ten dollars an hour, well below the minimum wage setting of about twenty-one dollars per hour in Australia. This despite claims by one food delivery service that riders make closer to twenty-eight dollars an hour before expenses. If net earnings equate to ten dollars per hour though, then reform is certainly necessary.

The federal opposition meanwhile believes mandating working and pay conditions won’t suit all gig-economy workers, especially self-employed tradespeople:

In response to the government branding the gig economy a “cancer”, opposition industrial relations spokeswoman Michaelia Cash said Labor was demonising self-employed people in service of the unions. “This attack on the gig economy will end up being an attack on all independent contractors – like truck drivers, plumbers and numerous other hard-working tradesmen and women,” Cash said.

Cash appears to be referring more to workers on platforms such as services marketplace Airtasker, where people can hire anyone to do literally anything, as long as it is safe and legal. Trades people such as delivery drivers, plumbers, and other self-employed skilled workers, can do well on these platforms, as they’re able to ask for hourly rates sometimes venturing into triple figures.

The same goes — to an extent — to unskilled, though experienced, workers carrying out “odd jobs” on such platforms, who have garnered favourable feedback or reviews for their services, and have shown themselves to be reliable. They’re able to negotiate a fair price for the work, or task, they perform, taking into account job and travel costs, provision for taxes (all gig-economy work in Australia is taxable), and a margin for themselves.

No doubt there are instances of worker exploitation though. Those new to the platform, who have less leverage than established workers, and travellers, or backpackers, unfamiliar with minimum pay rates in Australia, possibly stand to lose.

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Buying a car is the biggest purchase you make not a house

17 August 2022

Buying property is the biggest purchase most people will make. The process is given thorough due-diligence. And rightly so. In Australia, depending where exactly you buy, a free-standing house can cost near on one million dollars. You don’t commit to a million dollar obligation without understanding the ins and outs of the undertaking.

Of course a house you paid one million dollars for will end up costing closer to one million four hundred thousand dollars, if you had to fully finance the property, and pay an average interest rate of two and half percent over the course of a thirty year mortgage. Things like maintenance and insurance will also add to the overall cost. But usually that’s ok. Houses are generally assets that appreciate over time, so you’ll recoup the costs when you eventually sell, and, with any luck, make a tidy profit.

But here’s something, buying a house is not the biggest purchase many people will make. Owning a car will be. In Australia, owning a car could end up costing over two million dollars, were a driver to own a succession of vehicles over a sixty year period. How though can a car — even a small vehicle, going for maybe A$25,000 at the dealership — possibly turn out costing two million dollars? Ongoing running costs, which most vehicle owners grossly underestimate, is why.

Berlin based YouTuber TechAltar looked at the long-term costs of car ownership, and made the following conclusions:

  • Car owners typically underestimate car running costs by fifty-two percent
  • Thirty to forty percent of semi skilled and unskilled workers incomes will go into their cars, assuming they own vehicles for at least fifty years
  • Societies subsidise drivers by €5000 each year, so it’s not only car owners who pay

In Germany, a Volkswagen Golf typically costs the owner €7,657 per year to own and run. This includes depreciation, petrol, taxes, maintenance and so on. Based on a conservative study from a few years ago, if you own and use a car of that size over 50 years, it comes to a total cost of €403,179. If we stretch that to 60 years and apply a more realistic inflation rate of 2.5%, that small Golf will incur a lifetime cost of €1,579,583! On a medium income, that’s 30-40% of every euro earned, ever.

To convert those numbers to Australian dollars, a Volkswagen Golf, or an equivalent vehicle, would cost $11,075 each year. Over fifty years the cost is $583,286 (you could buy a modest size apartment for that). Over sixty years of ownership, and applying an inflation rate of 2.5 percent, the cost works out at $2,285,029. $2,285,029: with that sort of money you could buy a house, being, as we all know, an appreciating asset.

While fuel costs, vehicle taxes, and on the road costs might vary between Germany and Australia, I’d say the numbers would be pretty similar. And don’t forget to add in parking and traffic-offence fines. While car ownership is an unavoidable necessity for some people, those with young families among them, remind me again why anyone would otherwise want to own a car. Especially those living in centres with good public transport and cycling infrastructure.

Via Dense Discovery, a weekly, Australian produced newsletter, which I highly recommend you follow.

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Dumpster diving, finding food when prices are rising

27 July 2022

Inflation is back. Prices are rising — sharply in some cases — adding to the cost of living. My go-to — highly anecdotal of course — inflation indicator is the price of a large sized takeaway cappuccino. While rises in the price of coffee have been on the cards for some time, I paid A$5.20 for a cup in Kogarah, a southern suburb of Sydney the other week, the first time I’ve seen the cost exceed five dollars.

But the price of household staples, not just coffee, have also been rising steadily in recent months, imposing financial hardship on many people. Despite this, some Australian supermarkets are engaging in what is surely the unconscionable practice of disposing of food products before their use by date, or fruit and vegetables that simply don’t look saleable, without even offering them at a reduced price beforehand.

But savvy consumers, including Sydneysider Brenden Rikihana, are countering this wasteful process by taking to dumpster diving. That is, going around to the dumpster bin area at a supermarket, and sifting through them for food that is still safe to eat. And if Rikihana’s Facebook page is anything to go by, dumpster divers are truly spoilt for choice at the moment. In fact Rikihana collects so much usable food, he gives a lot away to others.

Dumpster diving can’t be without its hazards. There’s obviously a danger to sifting through waste bins. Broken glass, other sharp objects, not to mention who knows exactly what’s been put in the dumpster. Then there’s the legalities. Some of the bins are probably on private property, so trespass may be a factor. I doubt few people rummage through dumpsters out of choice though. And that’s the problem at the moment. For many it’s not about choice, it’s about necessity.

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