UNEMPLOYMENT

Evening Post, Volume CVI, Issue 4, 5 July 1928, Page 13

UNEMPLOYMENT

SEEKING THE CAUSES PROFESSOR'S INQUIRY "MIGRATION NOT TO BLAME (From "The Post's" Representative.) SYDNEY, 28th Juno. In New Zealand, as in Australia, migration has been freely blamed for unemployment. In fact, Now Zealand went so far as to restrict migration in the hope that the position would be- relieved. According to Professor I>. B. Copland, Dean of the Faculty of Commerce at the Melbourne- University, restriction of migration is not a remedy for unemployment, for he claims that there is little if any connection between the two. In a special roport prepared in conjunction with the Development and Migration Commission ho supplies a graph showing the relationship between migration and unemployment in Australia during the last twenty years which indicates that at. times unemployment was low when migration was high, and that unemployment was high when migration was low. "What seems to emerge from a consideration of the question," he says, "is that immigration is not a fundamental cause of unemployment, and that the flow of migration into a country will to a great extent automatically adjust itself into the economic conditions of the country." Professor Copland states that it is ■wrong, in his opinion, to think that there aro only two stages through ■winch a country passes, those of extreme prosperity and extremo depression. Fluctuations in employment and unemployment are a definite indication of the'existence of the business cycle, but it is extremely difficult to make people realise this. He quotes as an example the constant endeavour to explain periods of unemployment by some concrete cause of the moment, as, for instance, the explanation of the postwar unemployment, as the result of war-time disorganisation and the burden of finance. The recent crisis in Australia, he says, has been attributed .to such explanations as over-import-ing, high taxation, and the bad season. It is not recognised that such periods of unemployment recur at frequent intervals in all countries, old and new, * agricultural and manufacturing. less complex the economic structure of the country, he says, the less severe, usually, are the crisis of unemployment. Commenting on the relationship between importing and prosperity, ho says that active importing is often continued too long after conditions ■warrant and over-trading characterises the breaking of a period of good business. Contrary to the general belief, Professor Copland does not regard weather conditions as the only causes of changes in Australia's business prosperity. While it is obvious that good harvests encourage trading activities, and that bad seasons will contract the volume, of business, there are other factors exercising a dominating influence at times. Depressions do not. always *coincide with bad seasons, nor does prosperity with bad ones. He points out that rapid falls in prices always have been accompanied by increases in. employment, and that rises in prices have almost invariably been accompanied by marked reduction in employment. It is highly probable, he states, seasons have a more serious influence on Australia than on older countries. Primary products fluctuate more violently than secondary ones, and the burden of Australias' debt is greatly increased by. a fall in prices, and equally greatly decreased by a rise in prices. ■ Professor Copland says that it is important that measures should be taken to cheek an undue expansion of imports, unless exports are expanding or some other source available for replenishing banking funds in London. That could best be done by a more 'rapid adjustment of credit conditions in Australia to changes in the balance of payments. For this purpose he recommends that the Commonwealth Bank, should extend its functions as a central exchange bank, and thus control banking credit according to trade conditions. Other recommendations for controlling unemployment included in the report deal with business management. The first condition of success, it is said, is the greater recognition on the part of business men that the periodic fluctuations in business, known as the trade cycle, exist. It would then be', possible to plan building and construction works, and purchasing and selling policy, according to the stato of business. Thus, heavy construction work would not be undertaken when business conditions were very active. With the existing system active business conditions are intensified, and when depression seta jn the expansion of the manufacturing plant involves serious economic loss. It would be wiser to enter upon tho construction programme . during the depression, thus alleviating bad trading condition's. In that way I stability would be promoted, and the volume of unemployment lessened. Professor Copland says that at present Australia is passing through a period of mild depression which was preceded by active business conditions over the whole of 1926. Ho prophesies that it will be followed eventually by 1 a period of recovery, probably developing into active and. oven boom conditions.