Toyota’s announcement that it will stop making cars in Australia by 2017 adds to the urgency for productivity and new jobs to be created elsewhere in the economy, says one of the leaders of Australia’s start-up sector. “My personal experience over the years has been that as far as innovation is concerned, necessity is the mother of invention,” Leni Mayo, chairman of Startup Victoria, told StartupSmart. Toyota’s announcement draws the curtain on Australia’s car manufacturing industry, following earlier announcements that Ford and General Motors Holden were also closing. Thousands of people working for the companies will lose their jobs and there are fears thousands more are under threat as car component makers consider their futures. Mayo says while it will be difficult for the workers who lose their jobs and their families, manufacturing as a share of Australia’s economy had been declining for the past 40 years. “That’s a trend that’s going to continue,” he says, noting that service-related businesses now make up the bulk of Australian jobs. Mayo says thought must go into what can be done to accelerate the growth of start-ups to fill the gap left by manufacturing. He points to more innovation in the services space as a key area to promote where companies such as Seek and Carsales.com.au found success. He also urged politicians to celebrate start-up successes and openly talk about failure, as well as create more visibility and legitimacy around start-up activity and encourage people into pursuing science and technology at university. “We’ve got a long way to go in Australian compared to the US and Israel with how we feel about failure.”
Ford has the opportunity to give the 1200 employees it will soon retrench a new start. The closure of another iconic Australian plant — BHP’s Newcastle steelworks — offers an example. In 1999, around 1800 BHP employees were left jobless by the closure of the Newcastle steelworks. Their average age was 44, and their average length of service 21 years. As with Ford, there was considerable time between announcement and closure, two years in the case of the steelworks. This gave BHP time to work with unions, the community and government to devise initiatives that would give employees and the regional economy the strongest grounding for a positive transition. The result was an innovative response to the plant’s closure, a key element of which was BHP’s “Pathways” program. Pathways was a personalised and flexible retraining program that supported employees to train in almost any area of their choice if it was likely to help them find employment. The program was not based on financial constraints or a set training program. Instead, each employee was interviewed about his or her aspirations in a post-steelworks world. BHP would cover whatever was required, including university or TAFE fees, textbooks and flexible work arrangements around study. The scheme gave rise to a wide range of individually chosen career changes — everything from nursing to flying to public relations. In several instances, employers experiencing a skills shortage approached Pathways and offered guaranteed employment. The match between the experience of the employees and the shortage of technology teachers in NSW sparked collaboration between BHP, the NSW Department of Education and the University of Newcastle. Around 80 employees trained onsite at the steelworks to become teachers. In this case the Industry Recognition of Prior Learning principle was developed to draw on the skills of employees with little or no tertiary education. When the Pathways program was wound up a year after the steelworks’ closure, around 7000 separate training events had taken place and around 90% of participants were employed. BHP fully funded and managed the program. Despite the unconstrained nature of support to individual employees, the scheme was cost-effective. Employees were offered a bonus payment (on top of redundancy entitlements) if they stayed until closure, but as many were moving into other jobs as a result of Pathways, they gave up this bonus and the salary they would have been paid in the remaining time. That meant the scheme paid for itself. The success of Pathways — which becomes apparent when you talk to anyone who took part in it — was that it brought hope and new purpose to a community facing the end of what had been their lifeblood for generations. As with the Newcastle steelworks, both the Commonwealth and state governments have pledged funding to support economic development and diversification in the Geelong and Northern Melbourne regions following the Ford closure. This support will help to create new opportunities. However, for many Ford workers, years of experience and specialised skills will not necessarily be transferable from sunset to sunrise industries. While the mismatch between declining and emerging industries is in the nature of structural adjustment, a program such as Pathways helps employees to bridge that gap. It may also trigger initiatives, like the Newcastle teacher training program, that use existing skills in new ways. As Ford brings its more than 90-year history in the region to a close, it has an opportunity to generate new beginnings, and do something momentous for its workers. *Alicia Payne is an economist and public servant. She undertook a research project on the response to the Newcastle steelworks closure while at the University of Sydney. These views are her own.
Another high-profile Twitter hacking attempt has caused havoc in the United States, with the Dow Jones shedding 143 points after the hacked Associated Press Twitter account incorrectly reported President Barack Obama had been injured in an explosion. The hack is the most serious of the attempts which have occurred over the past several months, with other hacks targeting the accounts of automotive group Ford and Burger King. Businesses have been issued yet another warning by social media experts to keep their accounts locked up tight, and start developing better security around their social media practices. While previous Twitter hacks have resulted in controversy, this is the first time such a hack broadcast a story which could have been seen as believable. Anthony Mason, manager of digital research and analysis at online reputation management group SR7, told SmartCompany this latest incident is a "mixture of both security and social media strategy". "More importantly, this an issue around governance of media, an aspect commonly neglected throughout the broader business maturation of the medium," he says. Mason points to the recent HMV case in Britain where staff were able to post on the official account while they were being fired, giving an account of the firing process. He also points out some security issues – Twitter doesn't have two-factor authentication, and is thus more susceptible to attack. Mason says small businesses need to take note of who has access to social media accounts and then put in place monitoring protocols so that any access breaches are identified at an early stage. "Small businesses should be across any third-party suppliers that may have access to official social media assets. These may include web designers, social media strategists and community managers." A debate often posited among social media advisors is whether or not small businesses should be using third-party companies to monitor their social media accounts. While this often means less total control, it does mean employee breaches are less likely. It also means these companies are more likely to pick up on a breach. Mason says businesses need to start taking social media more seriously, especially as he notes business models are beginning to value social media insight and "the immediacy of information". "Ownership and transition of social media account access should be included in employment contracts to make expectations clear and to provide companies with a legal basis on which to take action." This story first appeared on SmartCompany.
Former Ford boss and BHP Billiton chairman Jac Nasser has lamented Australia’s lack of patriotism in the auto industry, claiming the closure of the Australian operations of either Holden, Ford or Toyota could spark a “domino effect” in our local auto industry. “The signs aren't good, and particularly when the car industry is reducing the number of engineers they have in the workforce. That's a leading indicator of a reduction in future programs and future technology,” Nasser said. “Let's assume one of the three decides to exit Australia in terms of manufacturing, then you end up potentially with a sub-scale supplier infrastructure and, once that happens, I think it's a domino effect. It would be a very sad day for Australia, but unfortunately it looks like it could be inevitable.” Coalition flags possible industrial relations changes Shadow workplace relations minister Eric Abetz has raised possible limits on the conditions unions could place in enterprise bargaining agreements as a possible Coalition industrial relations reform, with agreements limited to matters directly relating to the employment relationship. Senator Abetz has also attacked recent and proposed amendments to the Fair Work Act, including a proposal to introduce compulsory arbitration in long-running disputes. “You've got to wonder, if it was so important that compulsory arbitration not be a hallmark of the Fair Work regime in 2007 and 2008, what's changed? Unions threatening to withdraw election funding unless this extra change is fast-tracked?” Abetz said. Telstra to cut up to 55 jobs from its online media unit Telstra’s chief marketing officer Mark Buckman is heading up a review of the company’s digital media division that could see up to 55 jobs cut, according to The Australian. The aim of the review is to streamline the company’s focus around its three key media assets, including T-Box, exclusive digital music and sports content, as well as Foxtel, of which the telco giant owns 50%. “We think that if we focus on being a core partner for Foxtel in reselling Foxtel through Telstra, if we become the number one IPTV provider in the country and if we deliver the best and most compelling content in the digital content services business… we have the opportunity to be a leading player (in this space)," Mr Buckman said. Overnight The Dow Jones Industrial Average is up 0.42% to 14,865.14. The Aussie dollar is up to US105.3 cents.
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