For the last 40 years SA’s economy has been on a slide. Sometimes there’s an uptick and the media goes ballistic that the state is doing so much better than the eastern states but these structural issues are ongoing.
Unfortunately, this parochialism is also evidence of deep and severe economic issues. The truth is SA is supported by Canberra.
There are still jobs around but they are hard to get. Online comment boards are replete with angry and rejected local and interstate people looking for work in Adelaide. You’re lucky to get a rejection email.
On Wednesday, the Premier announced the state government would stump up another $137.5 million to keep the Whyalla steelworks running.
That’s on top of $192 million the government had already allocated to keep the steelworks afloat, bringing the total state contribution to $329.5 million. The Commonwealth has pledged an equal amount.
The state and federal governments combined for a $2.4 billion Whyalla rescue package in February. On Wednesday, another $275 million ($137.5 million each) was added to that funding pool.
The Port Pirie lead smelter, which employs about 900 people on the Spencer Gulf, is cactus. Nyrstar wants a support package that could be worth hundreds of millions of dollars.
On Thursday, SA’s largest disability employment provider, Bedford Industries, was on the brink of administration — raising fears for the future of 1,400 people with disability and about 250 staff.
James Hancock, deputy director of the University of Adelaide’s SA Centre for Economic Studies, told the ABC Whyalla, Port Pirie and Bedford had left the government “between a rock and a hard place”.
He said government intervention to save a business meant “you then potentially have a queue of other businesses approaching you for support when they’re in difficulty”.
“The state budget can afford to do it for an extended period, but the real issue is if you’re doing this for an extended period, what are you doing for other sectors that come under pressure?” he said.
South Australia is not short of examples of what happens when a long-standing industry collapses and there is no white knight to save it.
Adelaide’s north never recovered following the closure of Mitsubishi in 2008 and Holden in 2017.
The end of coal mining in Leigh Creek in 2015 saw that town’s population shrink from 2,000 residents to just 100.
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