Structural Adjustment Packages:Definitions, Opportunities and Lessons

Professor Andrew BeerCentre for Housing, Urban and Regional 

PlanningUniversity of Adelaide

What Do We Know, What Don’t We Know?

• Structural adjustment in the Illawarra• A Tale of Two Cities

– Personal and regional adjustment • The Riverland Experience • Lessons to be Learned

The Illawarra

Two Cities: Birmingham and Adelaide 

• MMAL Lonsdale April 2004, MG Rover May 2005• Adelaide 

– Structural Adjustment Fund for SA (SAFSA)– Redundancy payments from MMAL – Worker assistance via JobsNetwork 

• Birmingham – Minimal redundancy payments – Range of government actions via MG Rover Taskforce  & Advantage West Midlands 

AusComposites

Redarc Electronics

Alloy Technologies

Cubic Pacific

Ingham's Enterprises

Fibrelogic Pty LtdResource Co.

PBR Australia

ScreenCheck Aust.

True Life Creations

Origin Energy Solar Pty Ltd

Jumbo Vision InternationalIntercast & Forge

Inpak Foods

Seeley International

BD Farms Paris Creek

Normanville Export Meatworks

Peats Soil & Garden Supp.(Willunga)

Peats Soil and Garden Supp.(Dublin)

GulfSt. Vincent

GulfSt. Vincent

0 5 10 Km

"

500,000

1,000,000

2,000,000

4,000,000

6,000,000

Dollars (AU)

Suburb

0 50 Km

SAGE Group Holdings

®

Datum: GDA94Projection: Lambert Conformal ConicData Source: School of Geography, Flinders University 2007.Australian Bureau of Statistics 2007.

Created by Nicole MahoneyDate: 26th July 2007.

0 4 8 12 162Kilometres

Legend

Number of Workers1

2.5

5

7.5

10

25

50

75

Local Government Area

Lonsdale

Riverland Futures Taskforce

• Riverland Futures Taskforce – $20m structural adjustment fund established by SA Government  (Riverland  Sustainable Futures Fund)

• Now administered through RDA Committee – Limited take up, slow take up 

• And does it address the region’s fundamental needs in an era of capital mobility?

Opportunities and Lessons 

• Labour market adjustment – Haynes notes labour assistance packages more effective in buoyant economic conditions 

– Redundancy payments can have perverse (?) impacts

– Labour mobility is a critical issue – the Oswald thesis 

– Acquisition of formal qualifications key 

Opportunities and Lessons 

• Structural adjustment – Packages tied to the region affected, limit the spillover – Tension between supporting industries that will grow and 

the industries workers will move to– Time frame 

• Bailey et al note the importance of slowing the adjustment process

–  Significant action in advance of Rover collapse in Birmingham, on-going company support in SA

• Public sector leadership in planning for and managing adjustment