Monthly Archives: February 2015

Some thoughts regarding Venture Southland’s “Southland Region Labour Market Assessment”

I came across the report here:

My immediate thoughts in response to a quick scan through the report introduction:

From the introduction to the report: “historical data, feedback from the Venture Southland labour market workshop, and broad regional and national trends, are then used to project both future labour supply and labour demand for the Southland Region, from 2014 to 2031” – the problem being that at this point, on the cusp of economic, energy and geopolitical crisis (, the ‘historic data’ and ‘trends’ are not a reliable predictor of the future. This point was well made last year in the ‘Better Growth, Better Climate’ report by the prestigious global economics committee for the ‘New Climate Economy’ taskforce which states simply ‘It will not be business as usual’ (, although it’s neo-classical economic assumptions are flawed.

Specifically, assumptions of ‘business as usual’ are flawed at this point as declining energy profit from fossil fuels ultimately driving a loss of GDP, an effect that can only be temporarily masked by printing money (QE) and other neo-classical or ‘Keyensian’ assumptions. Rather, we must consider the physical reality, which is that the economy is fundamentally intertwined with ecosystems and a finite resource base, and that we’re up against planetary boundaries as a species. This means that the patterns of these complex adaptive ecosystems will enforce limits based on energy availability on economic activity (entropic or energy profit related, a point I’ve made here: Consider some of the policy implications that this implies:
“An acceptance that the human society and economy are governed by the same nested adaptive cycles as ecosystems, leads to an acceptance that growth is only one part of a healthy adaptive system. For such a system to remain healthy it must experience regular periods of contraction and radical reorganization. Such an insight stands in deep contrast to a Keynesian philosophy that believes that fiscal and monetary policy should be utilized to offset the contractionary part of the cycle. It also challenges the neo-classical tradition that views the economy as a self-correcting system that tends towards an efficient equilibrium point. Instead, an economy may experience sudden and significant changes that move it from one equilibrium point to another that exhibits lower levels of social welfare. This was the case during the 1930’s.
Preventative measures would seek to facilitate both more regular, but smaller, periods of reorganization and limit the social impacts of such reorganizations (e.g. increased unemployment). In addition, the preservation of institutions, resources and knowledge required for the next growth phase would be an important consideration. In this light, the extension of the economic and growth cycles through the utilization of fossil fuels, and the extension of the financial system growth cycle through repeated bailouts and rescues, could be seen as creating a much larger contractionary phase in the future. Resilience continues to be degraded, and network complexity and interdependence intensified, rather than the required simplification being allowed to take place. With an earth system that is being pushed into a contractionary cycle by the huge scale of humanity’s ecological footprint, and the possible peaking of fossil fuel energy on the horizon, both ecological and human cycles may interact in a rapidly reinforcing fashion. Better to release some of society’s adaptive cycles prior to the challenges that may be delivered by resource constraints and multiple probable ecological crises.
One of the system rigidities produced by the extended conservation phase that human societies have been experiencing are the dense, strong, interconnections between sub-systems as the global economy becomes more integrated and extensive. Local production has been replaced by global production networks that tightly integrate many regions together, with the final assembly of a product possibly involving subsystems supplied by a myriad of suppliers based in many different countries. Just-in-Time delivery systems have also removed many of the local stockpiles of goods in the name of efficiency. The branches of national, and global, banks have replaced local financial institutions. Overall, there has been the growth of very large organizations, both private and public, upon which the system depends. Examples are the “Too Big To Fail” financial institutions, large corporations in the agricultural, retail, energy and other areas, together with, central banks. Locally produced food has been replaced by the production of cash crops for export, with countries being made more dependent on imports for basic foodstuffs. In the case of Europe, even national currencies and governance structures have been replaced by the Euro and European-level organizations. Local variability, and the range and scope of locally adaptive changes have been reduced. The buffering effect of local production and buffer stocks has been removed. The overall global system may have become much more efficient, but much of its resilience has been the price of that efficiency. The system has also become more tightly fitted to, and therefore dependent upon, its current ecological and resource niche. Complicating, and deepening, any reorganization phase.
Another issue is the reduction in heterogeneity and redundancy, as globalization concentrates and homogenizes organizations, products, cultures, and worldviews. A single monoculture is much less resilient to challenges than one with much variation and duplication. In the latter, the removal of a single subsystem may be dealt with successfully through the ability of other subsystems to take over at least part of the functions provided by the failed one. Through the impacts of industrial agriculture, a limited set of crop variants has replaced a much greater variety of local variants in many parts of the world. These crop variants are dependent upon a wide range of industrial inputs, from herbicides and fertilizers to farm machinery and the oil that fuels them. On a cultural and worldview level, Micheals[12] argues that a single master story based upon economics has largely forced out competing narratives. He states:
“In … the twenty-first century, the master story is economic; economic beliefs, values and assumptions are shaping how we think, feel, and act. In a monoculture … that single perspective becomes so engrained as the only reasonable reality that we begin to forget our other stories, and fail to see the monoculture in its totality, never mind question it. We accept it as true simply because we’ve heard its story so often and live immersed in it day after day. The extent to which we accept that monoculture unquestioningly and live by its tenets is the extent to which our lives are unconsciously being shaped by it.”
Such as unquestioned belief system greatly restricts the possible corrective actions that can be taken, by restricting the conceptual framework within which such actions will be assessed. Some possible actions may also be explicitly excluded from, or simply not part of, the conceptual framework that stems from the belief system. Due to this, human society may be unable to even contemplate actions that would be beneficial to its ability to successfully traverse the process of reorganization.
Beneficial policies would be those focused on fostering diversity in all forms, and forestalling economic and social concentration.”
Also from the introduction to the report: “While supply of labour is projected to decrease, with sustained economic growth, demand for labour in Southland is projected to increase” – sustained how exactly, in light of a probable rather than wished for, or indeed ‘projected’ future..?
Lastly from the intro: “many strategies will be increasingly difficult to implement in a global environment of high competition for labour” – in a region such as Southland, with so many of the fundamentals right (fresh water, productive land, low population, distance from nuclear hazards – military and commercial, region less effected by climate upheaval than others) I believe the opposite will be true in the timescale this report considers – there will be many people attracted here, and the problem will be integrating them all successfully (e.g. climate refugees from Australia)…
I hope Venture will consider these points carefully. I’m happy to talk to you regarding this at any point…

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