Jobs summit spotlights women and potential food crisis, US signs climate bill

The ASX has lost 3.52% over the past five days.

It’s been a breathtaking past week, with the index losing over 100 points in just five days and setting a new 20-day low today.

Only Consumer Staples managed to turn green this week, gaining 0.51%, with Materials losing the most, losing 10.45%.

Other markets were not spared from the bloodshed, falling across the board:

  • S&P500: -5.53%
  • Nasdaq: -6.67%
  • FTSE100: -4.43%
  • Nikkei225: -3.62%
  • Hang Seng: -3.42%

Commodities also collectively took a hit, with the smallest losses for gold (-2.51%) and the highest for tin (-12.98%).

West Texas Intermediate crude oil fell this week from a high of US$97.30 a barrel to US$88.47 today, a 9.07% drop in just five days.

Brent crude oil followed a similar trajectory, peaking at US$105.46 earlier this week before losing 10.63% to US$94.24 a barrel.

The cut could be timely for Australian consumers, who view the end of this month with trepidation as it marks the end of the fuel excise duty reduction of AU$0.23 per liter for unleaded petrol and diesel.

Jobs Summit highlights missing value of women’s work

The Jobs and Skills Summit has been in the news for the past few days as the nation waits to see if the outcome will be a speech or something substantial.

One of the most surprising developments has been the unlikely alliance between the Business Council of Australia (BCA) and the Australian Council of Trade Unions (ACTU) over paid parental leave and women’s labor force participation. in general.

The two organizations presented a united front on the issue of parental leave extensions – one of the biggest challenges facing women in the workplace today, alongside the gender pay gap.

Both the super and the pay gap have increased slightly this year, with the super gap climbing to 23.3% while the pay gap has increased by 0.3% to 14.1%.

For Minister for Women and Finance Katy Gallagher, addressing gender parity is a “fundamental economic imperative” for Australia.

“If women’s labor force participation matched men’s, we would increase GDP by 8.7% or $353 billion by 2050,” said Minister Gallagher.

Women’s participation in the labor force has historically been lower than that of men, largely due to the gender disparity in childcare and childrearing roles.

Women had an average turnout of around 62.2% in July this year, while men reached 70.8%.

This has a lasting and compounding impact on women’s opportunities, not only in the labor market, but also on their retirement accounts and other long-term assets.

The director of the Global Institute for Women’s Leadership, Professor Michelle Ryan, suggests that a systemic change in culture and policy is needed to close these gaps, and that there should be a greater focus on men as service providers. care.

“This has positive effects further down the line, with fathers who have taken significant parental leave being more involved in childcare even after the leave ends,” Professor Ryan said.

The first day of the jobs summit saw positive agreement on this front; The federal government will come up with a proposed change to child care subsidies, under which families with a combined income of less than $80,000 could see up to 90% of their child care costs paid for their first child.

The BCA and ACTU are pushing for an extension of parental leave from 18 to 26 weeks, but Minister Gallagher said budget constraints would be a hurdle.

“The Treasurer and I are also absolutely aware that we have massive deficits and a trillion dollars in debt…I wish I could fund all the good ideas that have merit,” said Minister Gallagher.

Potential food crisis on the horizon

Federal Nationals leader David Littleproud was present at the jobs summit, where he highlighted the need for 172,000 more workers on Australian farms.

Australia has mostly avoided the effects of the food crisis currently unfolding on the world stage, but past successes do not guarantee future security.

“I saw the human toll. In Carnarvon, [one farmer] walked away from his property because he didn’t have the confidence to be able to plant a crop and harvest it,” Littleproud said.

“Some farms plan to operate at only 50-60% capacity. It’s not just causing a cost of living crisis, it’s a food security crisis…I have pubs in my own constituency in Barcaldine, the seat of the Labor Party, where pubs are not open for feed themselves because they can’t cooks.

Breaking with traditional thinking, Littleproud said Pacific work visas are welcome, but “cannot do everything”.

“We’ve had enough of them coming to pick the crops and passing by; we want them to live in regional Australia,” he said.

The Nationals leader called for greater government support for those migrating to regional Australia, suggesting student debt waivers or reductions for healthcare professionals working in those regions, and recommended that support similar is extended to those working in elderly care.

US signs climate investment into law in the form of the US Inflation Reduction Act

US President Joe Biden signed into law the Inflation Reduction Act (IRA) on Tuesday, August 30, 2022.

Although the law is primarily aimed at reducing inflation, it includes a US$369 billion investment in climate action and renewable energy policies.

Its provisions are far-reaching, including:

  • the addition of two electric vehicle (EV) tax credits totaling US$7,500 for EVs assembled in North America and meeting certain conditions;
  • rebates available through state energy offices for homeowners who make energy-efficient upgrades; and
  • provisions to help make state and local government buildings cleaner through the adoption of net zero energy codes.

Investors in Janus Henderson have crunched the numbers and they believe the bill will provide substantial funding to develop electric vehicle charging infrastructure as well as funding for green hydrogen.

“In our view, the bill is an acknowledgment that the United States needs cheap, renewable forms of energy to both reduce inflation and move toward security of energy supply, reducing reliance on major suppliers like China and Russia, and turning instead to renewable energy grids. and other household energy sources,” the asset management company said.

“The Cut Inflation Act is intended to ensure that the United States makes real and faster progress toward decarbonization.

“It follows in the footsteps of other regions; the REPowerEU roadmap was unveiled by the European Commission in March 2022.

“It sets out a series of measures aimed at rapidly reducing dependence on fossil fuels, accelerating the green transition towards lower energy prices, increasing energy security as well as improving industrial competitiveness and supporting leadership. technology in the industries of tomorrow.

“China also has leadership ambitions in green technologies; Nearly half of global solar installations will be in China through 2031, according to Fitch Solutions, while the International Energy Agency (IEA) reported that half of global electric vehicle sales in 2021 were in China .

“For these reasons, the long-term investment case for a resource equity allocation has never been stronger.

“We continue to see a diverse range of attractive opportunities in a sector that provides the inputs and technological advancements needed for a more sustainable world.”

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Robert M. Larson