Australia to hit “peak labour” in 2011

Managing organisational risks related to changing demographics, particularly around aging, will soon become a major focus of management, according to social researcher and futurist, Mark McCrindle.

Speaking at the recent Security 2010 Conference in Sydney, McCrindle said that similar to the concept of peak oil – the point where the maximum rate of petroleum extraction is reached ­– Australian industry was facing the point where the maximum number of labour could be extracted.

“Next year in Australia marks the point of peak labour… from 2011 there will be more people exiting full time roles than there will be entering fulltime roles,” he said.

“It’s not so much peak labour, but peak easy labour. We have to work harder from now on to really sell the industry to the next generation, to train them, retain them and create raving fans who can encourage other successful and competent young people to join.”

Compounding this problem was the emerging pattern of job tenure, particularly among Generation Y (Gen-Y) employees, who were eager to jump between roles in a bid to gain rapid career expansion, often at the expense of experience and training, McCrindle said.

“Your average Gen-Yer stays an average of two years in a job in Australia today – that doesn’t build the experience and doesn’t bring the skills required for the leadership of the future,” he said.

In contrast the current national normative tenure per employer was four years. In turn this contrasted to some 12 years per employer back in 1970.

“That churn rate just won’t do if we are trying to build up the leadership, the knowledge and experience…” McCrindle said.

At the top end of the skills market, the trickle of Baby Boomer staff now beginning to retire would within 10 years turn into a flood.

“One third of today’s senior leaders, business owners and senior managers across industry in Australia today will be of retirement age within a decade,” McCrindle said.

“If you have a third of your leaders walk out the door in a ten year time window that is a massive loss of knowledge. That means training, leadership succession, transitioning and ensuring that that next generation can be attracted and retained.

To address this organisations should look to create roles for older staff to encourage them to stay in the workforce well beyond retirement age, McCrindle said. Link -
http://www.cio.com.au/article/359442/australia_hit_peak_labour_2011/
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In fact, the next 20 years will see some 4 Million working age Australians, enter their retire years!

In terms of Population growth, the largest generational growth ever were the Baby Boomers, who saw a growth of 54% in 20 years from 1945-1965. The following generation growth was around 39% from 1965-1985 and the most recent from 1985-2005 was only 28%.

Whilst there will no doubt be a great deal of pain involved during the run off of the Boomer generation retirements, there wound be MUCH GREATER PAIN, if we tried to expand our population again & invoking a massive decline in our essential Resources, such as Energy, Food & fresh water!  

'After the Fall': Why the Economic Future Looks Bleak

The next decade will have slow income growth and elevated unemployment. This is not only my opinion, but that of Carmen M. Reinhart and Vincent R. Reinhart in their paper entitled After the Fall – an analysis of past financial crises and forecasts how the Great Recession will play out. This paper was presented to 110 central bankers and economists at Jackson Hole in late August and the primary conclusion was dire for the aftermath of severe financial events such as the Great Recession:
Real per capita GDP growth rates are significantly lower during the decade following severe financial crises and the synchronous world-wide shocks. The median post-financial crisis GDP growth decline in advanced economies is about 1 percent.

After the Fall is saying the biggest mistake is governments believing the effects are temporary. Thinking that – a stimulus would cure the recession and moving to other business – appears to be criticized. The reaction of local and state governments in not assuming lower revenues were permanent stretches out resetting finances to a sustainable level. After the Fall took a swipe at central bankers also.

Economic contraction and slow recovery might also feed back on the prospects for aggregate supply. A sustained stretch of below-trend investment and depreciation of human capital prompted by elevated and lengthy spells of unemployment could hit the level and growth rate of potential output.

After the Fall warns that there are political moves which will magnify the crisis. In adverse economic circumstances, political leaders sometimes grasp for quick fixes that impair, not improve, the situation.

Economic leaders must paint rosy economic pictures or there is a danger that a negative economic perception will be self fulfilling.

After the Fall attacks the definition and meaning of “new normal”.

Here again, we are faced with a dynamic missing from most of the previous crises – demographics or “baby boomers”. The Great Recession was not triggered by the boomers, but once the recession set in – the boomers hunkered down because of a loss of net worth.

Boomers represent a disproportionately sized portion of the American economy. This segment was at nearing retirement This severe financial recession morphed into the perfect storm.

My take is that After the Fall is advocating not to worry about inflation. History has demonstrated that excessive capacity after severe financial events literally removes inflation as a possibility. It is hard to read After the Fall and not be depressed. It offers no real solutions. I hope it is wrong about our future.
Link -
http://seekingalpha.com/article/224762-after-the-fall-why-the-economic-future-lo...
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In my opinion, Baby Boomers were/are one of the unique factors that precipitated the current GFC, along with Peak Energy and rising Global Debt levels.

There is a phrase in the report, which reads -
"The human temptation to credit good fortune to good character and bad results to bad luck further complicates matters."

This reminds me of another human perception that the glass is either half full or half empty.
Of course, the real truth lays not in the current content of the glass, but whether that level is trending up or down and what, if anything can be done to change the trend?

The Global systemic crisis – Spring 2011: Welcome to the United States of Austerity / Towards a very serious breakdown of the world economic and financial system

As anticipated by LEAP/E2020 last February in the GEAB No. 42, the second half of 2010 is really characterized by a sudden worsening of the crisis marked by the end of the illusion of recovery maintained by Western leaders (1) and the thousands of billions swallowed up by the banks and the economic « stimulation » plans of no lasting effect.

First of all, there is a very depressing widespread reality, a real trip « to the heart of darkness », which is that tens of millions of Americans (nearly sixty million now depend on food stamps) who no longer have a job, no longer have a house, no longer have any savings, are wondering how they will survive in the years to come (11).

The coming months will reveal a simple, yet especially painful reality: the Western economy, and in particular that of the United States (2), never really came out of recession (3).

The startling statistics recorded since summer 2009 have only been the short-lived consequences of a massive injection of liquidity into a system which had essentially become insolvent just like the US consumer (4).

Now the first half of 2011 will dictate that the US economy take an unprecedented dose of austerity plunging the planet into new financial, monetary, economic and social chaos (7).

http://www.leap2020.eu/photo/2349781-3288312.jpgv=1284628704

The coming quarters will be particularly dangerous for the world economic and financial system.

The Chairman of the Fed Ben Bernanke passed on the message as diplomatically as possible at the recent meeting of world central bankers at Jackson Hole, Wyoming:
even though the policy to revive the US economy has failed, either the rest of the world continues to fund US deficits at a loss and hopes that at some point the bet will pay off, avoiding a collapse of the global system, or the United States will monetize its debt and turn all the Dollars and US Treasury Bonds held by the rest of the planet into funny money.

Unemployment hasn’t stopped growing and between the stability shown in official figures and the exit, in six months, of more than two million Americans from the workplace (LEAP/E2020 believes that the real unemployment figure is now at least 20% (9));

the U.S. housing market remains depressed at historically low levels and will resume its fall from the fourth quarter 2010;

last but not least, as one can easily imagine in these circumstances, the US consumer is and will be absent on a permanent basis since his insolvency continues and even gets worse (10) for the one American in five without work.

Behind these statistical factors hide three realities that will radically change the US and global political, economic and social landscape in future quarters as and when they dawn on the public consciousness.

The Federal Reserve now knows that it is powerless

Finally, there is a financial and monetary effect that is particularly tragic since the players are aware of their unenviable situation: the U.S. Federal Reserve now knows that it is powerless.

Despite the extraordinary efforts (zero interest rates, quantitative easing, huge support to the real estate mortgage market, massive support to banks, tripling its balance sheet, ...) that it carried out from September 2008, the U.S. economy will not restart.

Fed leaders are finding they are only a part in the system, even if it is a vital part and, therefore, can do nothing against a problem that affects the very nature of the system, in this case, the US financial system, designed as the solvent heart of the global financial system since 1945.

But the US consumer has become insolvent (20), the consumer who, during the last thirty years, has gradually become the central economic player of this financial heart (with more than 70% of U.S. growth dependant on household spending). It is this insolvency of US households (21) that has broken the Fed’s efforts.

Until summer 2010, they did not believe in the systemic nature of the crisis or they did not understand that what was causing the problems was out of reach of the tools of a central bank, as powerful as it may be. Only in recent weeks have they discovered two pieces of evidence: their policies have failed and they have neither arms nor ammunition.

Hence the very depressed tone of the discussions at the central banks meeting in Jackson Hole

In future quarters the Fed, like the federal government, will find that when the United States is no longer synonymous with juicy profits and / or shared power, its ability to convince its partners declines quickly and heavily, especially when the latter question the relevance of the chosen policies (25).

The consequence of these three realities that are gradually making their presence felt in US and global consciousness will, therefore, for the LEAP/E2020 team, come to pass in Spring 2011 by the United States entering an era of austerity unprecedented since the country became the heart of the global economic and financial system.
Link -
http://www.leap2020.eu/GEAB-N-47-is-avai....very_a5168.html
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Time will reveal if their predictions are correct!

That said, I am not sure about their timing? The US may get one more dose of that which can not work, Stimulus?

Dr Albert Bartlett

(Part 1 of 8)


(Part 2 of 8)


(Part 3 of 8)


(Part 4 of 8)


(Part 5 of 8)


(Part 6 of 8)


(Part 7 of 8)


(Part 8 of 8)


The Bacteria comparison in Chapter 3, is apt!

But, there are a few other apt observations –
1) Technology Optimists will always be able to solve all of our Population Growth, Food, Energy & Resources problems?
2) Thinking is upsetting, it tells us things, we’d rather not know!
3) The chief source of problems, is solutions!
4) Facts do not cease to exist, simply because they are ignored1
5) The 1st Law of Sustainability, is that Population growth &/or growth in the rates of Consumption of Resources
CAN NOT BE SUSTAINED!
6) The greatest shortcoming of the human race, is OUR INABILITY TO UNDERSTAND THE EXPONENTIAL FUNCTION!

Quote:


There are certainly some interesting views in there, Vegi!

Part 2: A Litany of Market Failures

According to the German report, there is "some probability that peak oil will occur around the year 2010 and that the impact on security is expected to be felt 15 to 30 years later." The Bundeswehr prediction is consistent with those of well-known scientists who assume global oil production has either already passed its peak or will do so this year.

Market Failures and International Chain Reactions

The political and economic impacts of peak oil on Germany have now been studied for the first time in depth. The crude oil expert Steffen Bukold has evaluated and summarized the findings of the Bundeswehr study. Here is an overview of the central points:


■Oil will determine power: The Bundeswehr Transformation Center writes that oil will become one decisive factor in determining the new landscape of international relations: "The relative importance of the oil-producing nations in the international system is growing. These nations are using the advantages resulting from this to expand the scope of their domestic and foreign policies and establish themselves as a new or resurgent regional, or in some cases even global leading powers."

■Increasing importance of oil exporters: For importers of oil more competition for resources will mean an increase in the number of nations competing for favor with oil-producing nations. For the latter this opens up a window of opportunity which can be used to implement political, economic or ideological aims. As this window of time will only be open for a limited period, "this could result in a more aggressive assertion of national interests on the part of the oil-producing nations."

■Politics in place of the market: The Bundeswehr Transformation Center expects that a supply crisis would roll back the liberalization of the energy market. "The proportion of oil traded on the global, freely accessible oil market will diminish as more oil is traded through bi-national contracts," the study states. In the long run, the study goes on, the global oil market, will only be able to follow the laws of the free market in a restricted way. "Bilateral, conditioned supply agreements and privileged partnerships, such as those seen prior to the oil crises of the 1970s, will once again come to the fore."

■Market failures: The authors paint a bleak picture of the consequences resulting from a shortage of petroleum. As the transportation of goods depends on crude oil, international trade could be subject to colossal tax hikes. "Shortages in the supply of vital goods could arise" as a result, for example in food supplies. Oil is used directly or indirectly in the production of 95 percent of all industrial goods. Price shocks could therefore be seen in almost any industry and throughout all stages of the industrial supply chain. "In the medium term the global economic system and every market-oriented national economy would collapse."

■Relapse into planned economy: Since virtually all economic sectors rely heavily on oil, peak oil could lead to a "partial or complete failure of markets," says the study. "A conceivable alternative would be government rationing and the allocation of important goods or the setting of production schedules and other short-term coercive measures to replace market-based mechanisms in times of crisis."

■Global chain reaction: "A restructuring of oil supplies will not be equally possible in all regions before the onset of peak oil," says the study. "It is likely that a large number of states will not be in a position to make the necessary investments in time," or with "sufficient magnitude." If there were economic crashes in some regions of the world, Germany could be affected. Germany would not escape the crises of other countries, because it's so tightly integrated into the global economy.

■Crisis of political legitimacy: The Bundeswehr study also raises fears for the survival of democracy itself. Parts of the population could perceive the upheaval triggered by peak oil "as a general systemic crisis." This would create "room for ideological and extremist alternatives to existing forms of government." Fragmentation of the affected population is likely and could "in extreme cases lead to open conflict."
Link -
http://www.spiegel.de/international/germany/0,1518,715138-2,00.html

The economy can’t grow forever

Commentary: The whole planet must live within its means

WASHINGTON (MarketWatch) — Those of us who believe that the economy should serve us instead of the other way around are conflicted.



Some people are in denial. They believe that the Earth’s resources are limitless and that a bean stalk can grow to the sky. Or perhaps they know deep in their heart that we are on the road to an environmental and economic catastrophe, one that they think they alone will survive through wits, gold, and guns.

Others believe fervently that technology will bail us out yet again, that clever primates will always find a new tool that will help us extract ever more stuff from the planet. They laugh at the warnings of the Rev. Thomas Robert Malthus, who warned in the 19th century that the population would inevitably outgrow the food supply, leading to periodic mass death due to wars, famines and plagues.

Malthus was wrong, of course...so far. Improvements in agriculture, finance, government, manufacturing and transportation kept pace with the population growth. Even with the population about seven times greater than in Malthus’s time, the percentage of the human race that is truly poverty stricken has fallen. On average, we live longer and better lives than our ancestors did. More people have enough to eat, clean water to drink, a secure shelter and basic health care.

Precarious poor
But the position of those poor billions in Asia, Africa, Latin America and even in America is precarious. The global recession hurt the poor and the nearly poor the hardest, showing in high relief just how dependent they are on our high-living ways.

The only working model of growth the developing world knows is to export more stuff to the rich countries. It turns out that the best way we’ve found to reduce poverty in Asia is for the rich in North America and Europe to consume more.

It’s the ultimate trickle-down economics. It takes ever-increasing consumption by those of us in the developed world to keep the hands of the developing world busy and their bellies full. We’ve outsourced the production, but not the consumption, except for a few crumbs.

But because we’ve outsourced the productive jobs, many of us in the developed world can’t afford to increase our consumption. The answer? More debt to pay for more stuff to keep the economy growing.



Money can’t buy me love
Everyone knows money can’t buy happiness, but we run our economy as if it does. Although it is plainly true that we do need to eat to survive, our well-being cannot be accurately measured by the sum of what we produce and consume.

A few economists have rejected the premise that the economy must grow forever. In Britain, the New Economics Foundation has created a Happy Planet Index as an alternative to the traditional measures of economic progress that focus on only growth, not on well-being or sustainability.

According to the Happy Planet Index, people who live in the richest countries aren’t any happier than those who consume less of our dwindling resources. A certain level of economic development is essential to our well-being, but our quality of life is also determined by how free we are politically, how equal we are socially, and by the opportunities we have to be creative or to live in a loving community. Read more about the New Economics Foundation.

This might shock you, but it’s possible to live a long, healthy, happy life without taking more than your share of the world’s limited resources.

Link -
http://www.marketwatch.com/story/the-economy-cant-grow-forever-2010-09-24
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Can anyone explain the very strange behavior that we are seeing in world financial markets right now? Corporate insiders are bailing out of the U.S. stock market at a very alarming rate. Investors are moving mountains of money into gold and other commodities.

In fact, there is such a rush towards gold that shortages are starting to be reported in some areas. Meanwhile, some very, very unusual option activity has started to show up. In particular, someone is making some incredibly large bets that the S&P 500 is going to absolutely tank during the month of October.

Central banks around the world have caught a case of "loose money fever" and are apparently hoping that a new flood of paper money will shock the global economy back to life. Meanwhile, the furor over the foreclosure procedure abuses of the major U.S mortgage companies threatens to bring even more turmoil to the U.S. housing industry.

There are some very ominous signs that something is just not right in world financial markets right now. Some of the signs listed below may be related. Others may not be. That is for you to decide. Often, just before something really bad happens, you can actually see the rats leaving a sinking ship if you know where to look. The truth is that if things are going to go south, it is the insiders who know before anyone else.

So are some of the signs below actually clues for what we should expect in the months ahead?

Maybe. Maybe not. You make your own call. But, it is becoming hard to deny that there are some serious danger signs out there at this point....

1.Corporate insiders are getting out of the U.S. stock market at an absolutely blinding pace. It is being reported that the ratio of corporate insider selling to corporate insider buying last week was 1,411 to 1, and this week the ratio has soared even higher and is at 2,341 to 1.

2.Many of the world's wealthiest people are buying absolutely massive quantities of gold right now.

3.It is being reported that J.P. Morgan (JPM) is gobbling up the rights to as much physical gold as it possibly can.

4.The United States Mint has announced that it has run out of 1-ounce, 24-karat American Buffalo gold bullion coins and that it will not be selling any more of them in 2010.

5.It is becoming increasingly difficult to explain the unusually high option volume that we are witnessing right now.

6.Some very large investors are making massive bets that the S&P 500 is going to take a serious tumble during the month of October.

7.On Tuesday, the Bank of Japan shocked world financial markets by cutting interest rates even closer to zero and by setting up a 5 trillion yen quantitative easing fund.

8.The president of the Federal Reserve Bank of New York and the president of the Federal Reserve Bank of Chicago are both publicly urging the Fed to do much more to stimulate the U.S. economy, including beginning a new round of quantitative easing, even if it means a significant rise in the U.S. inflation rate.

9.Nobel Prize-winning economist Joseph Stiglitz told reporters on Tuesday that the loose monetary policies of the Federal Reserve and the European Central Bank are throwing the world into "chaos".

10.At the end of September, federal regulators announced a $30 billion bailout of the U.S. wholesale credit union system.

11.Bank of America (BOC), JPMorgan Chase and GMAC Mortgage have all suspended foreclosures in many U.S. states due to serious concerns about foreclosure procedures. Now, Texas Attorney General Greg Abbott is actually demanding that all mortgage servicing companies in the state of Texas immediately suspend all foreclosures, the selling of foreclosed properties and the eviction of people living in foreclosed properties until they have completed a review of their foreclosure procedures.

12.Not only that, but Nancy Pelosi and 30 other members of Congress are requesting a federal investigation of the foreclosure practices of U.S. mortgage lenders. Needless to say, this controversy has the potential to turn the entire U.S. mortgage industry into an absolute quagmire.

So are dark days ahead for world financial markets? Well, yeah, but it is incredibly hard to predict exactly when things are going to fall apart. The truth is that there are going to be a whole lot more "crashes" and "collapses" in the years ahead. The important thing is to keep your eye on the long-term trends.

The U.S. economy is undeniably in decline. The only thing keeping the economy going at this point is a rapidly growing sea of red ink. Debt is literally everywhere. It is what our entire financial system is based on in 2010.

In the months and years to come, the major players are going to try very hard to keep all the balls in the air and to continue the massive shell game that is going on, but in the end the whole thing is going to collapse like a house of cards. Unfortunately, we have been destroying the U.S. economy for decades and there is simply not going to be a happy ending to this story.
Link -
http://seekingalpha.com/article/228650-12-ominous-signs-for-world-financial-mark...
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13. The US Fed Reserve chairman, shocked Global markets in a speech, where he confirmed that the USA was in deep crap and he reminded us mere mortals that, WE (mere mortals) are going to pay for it!