The spectacular collapse of Forge Group highlights some of the big differences between the resource states and other parts of Australia.
February has been a terrible month for workers across Australia.
Toyota’s decision to cease manufacturing operations in this country will directly lead to the loss of more than 2,500 jobs.
That follows earlier announcements by Holden and Ford to also cease vehicle manufacturing.
The direct job losses at these companies are likely to be outweighed by the fall-out among automotive component manufacturers and other suppliers to the industry, which collectively employ more than 30,000 people.
The timing of the Toyota announcement caught many by surprise but the decision itself should not have surprised anyone.
The company was hit by the high Australian dollar, the high costs of manufacturing, low economies of scale, and the impact of current and future free trade agreements.
It was a similar story at Holden, which cited a "perfect storm" of poor economic conditions.
The impact of job losses in places like Geelong, Broadmeadows and Adelaide will be exacerbated by the fact many employees in the auto sector thought they had a job for life.
In some cases, the auto manufacturers had employed multiple generations across extended families.
These are the kind of people who really struggle with economic change; who are loath to pick up their families and move to other regions like Western Australia where jobs growth has been much stronger over the past decade.
The willingness of unemployed workers to move to WA will have taken a dive, after this week’s news that 1,300 Forge Group workers were retrenched with no notice period and no pay.
Wouldn’t the Forge Group workers have appreciated the two or three years notice periods given to their east coast counterparts!
The demise of Forge is the flipside of WA’s economic and commercial success.
We live in a state where fortunes can be made quickly, and where hard-working individuals can earn incomes that would be the envy of manufacturing workers in Broadmeadows.
Forge Group came from almost nothing six years ago, and rapidly grew to the point where it had more than 2,500 workers – about the same as Toyota in Australia.
A couple of very badly managed contracts was all it took to bring the whole business down.
But it’s not alone in experiencing big job losses.
