All Topics / Help Needed! / More job losses in Geelong

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  • Profile photo of JpcashflowJpcashflow
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    Hi All,

    I am not sure if any one has heard, but Target will be slashing a number of jobs at its DC plant.

    Unemployment rate in Geelong not looking good!!!

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    Profile photo of Jacqui MiddletonJacqui Middleton
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    Don't you worry JP, Aunty Julia will happily dish out benefits. 

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    Profile photo of jmsracheljmsrachel
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    Aunty Julia will be unemployed in a few months.

    Profile photo of DerekDerek
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    Hasn't she already done that?

    Wasn't there a recent announcement to do with NDIS administration/centre being based in Geelong?

    Profile photo of FreckleFreckle
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    jmsrachel wrote:
    Aunty Julia will be unemployed in a few months.

    Unfortunately not. Her seats pretty safe. She might not have the top job and there's a pay cut when you're in opposition but my guess is the old girl won't entirely disappear off the radar. She might even make a good opposition leader if she could hold on to that which I doubt. 

    Profile photo of Nigel KibelNigel Kibel
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    I think that there is a danger that the Geelong market may take a hit. Julia will not be in a position to help anyone except her own pension fund

    With business closing the perception of a falling employment will be enough to flatten prices. 

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    Profile photo of JpcashflowJpcashflow
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    I have to agree with you Nigel on this one…

    Also areas like Werribee, Hoppers Crossing will feel the on flow effect as well.

    I think Melbourne market is heading for very hard times, I dont care what any ways says…

    Cheers

    JP

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    Profile photo of FreckleFreckle
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    Jpcashflow wrote:
    I think Melbourne market is heading for very hard times, I dont care what any ways says…

    Cheers

    JP

    Vic's taken bit of a hit over the last few years. I'm not sure it will drop much more unless there's a severe down turn. Generally markets that have seen fairly stiff corrections generate resistance to further declines after a while. I kinda think that's where Vic is at the moment. Having said that I agree with JP in the sense that the Vic market will drift at best but we're more likely to see a shallow decline over the next few years.

    I definitely don't see anything significant enough to give the market a lift for some time. It'll be a tough market to make a buck out of.

    Profile photo of JpcashflowJpcashflow
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    100% agree freckle,

    I would rather keep my lotto store that provides a cash flow postive return every month then buy a property in vic

    thanks to a certain mate of mine the retail side is picking up too ….

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    Profile photo of PLCPLC
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    What I find puzzling is why Julia comes out and offers a $50 million dollar assistance package to retrain 500 Ford workers ($100K to train each person??????), when every week small businesses are closing down with 5 or 10 workers and she and her Labor party couldn't give 2 hoots about forking out money trying to find them new employment and leave them to their own devices.

    Sure 500 jobs being lost is a sad event, but why are Ford workers so much more special and getting preferential treatment than the average Joe in the same boat? Smells of hypocrisy and vote buying (though it won't help her).

    Cheers

    Tom

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    Profile photo of JpcashflowJpcashflow
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    PLC you have hit it right on the nail!!!

    Its true what you have said a a number of small to medium are shedding jobs to, this thing with ford is just a way to buy more votes…

    The country is in a mess because of two main reasons from my point of view

    1) Government have an idea on whats going on but have no solution to the problem

    2) People: People simply dont know how to manage money….

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    Profile photo of MikalHowardMikalHoward
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    The Ford situation is not a vote buying situation. I am a Holden worker and I can tell you, I am feeling the Ford situation now more than ever. What the Government is trying to do is assist with career counsellors, re-training options and financial management assistance because the auto manufacturing industry, one of the most important industries to ANY country, is failing here in Australia. It has been on the cards for many years going back past Bob Hawke's days when tariffs were started to be reduced. The thing is out of every other auto manufacturing country in the world, Australia is the only one to not protect its owns backyard. It costs next to nothing to import a vehicle into Australia because of the so called free trade agreement with the rest of the world. That being said, every other country has either changed their minds or reneged on the agreements and because of that for us here in Australia, to export our cars, there are massive tariffs we have to pay, as well as contending with the high dollar. Its just not feasible anymore. It has nothing to do with what Ford, Holden, Toyota or even Mitsubishi have done with their cars over the years. Sure, not every car is to everyones tastes. That plays a massive part in why people buy vehicles. We know that. What we have always done is offer vehicles to the Australian public that are some of the safest on the roads in terms of industry quality tests and cars that are made specifically for Australian conditions. Every car can have a dud in its range. Even expensive cars. They are machines after all. I'm sure most people here would have had a problem vehicle at least once in their life. If you haven't, that's great.

    Australia currently has the most diverse range of new vehicles available to its population than any other country in the world. Almost 70 different makes of car. That is a lot of choice for 22.3 million people. In the USA, with 314 million people, they have around 30.

    Out of those 70 odd makes of car, all of the Australian made vehicles (Falcon, Commodore, Camry, Aurion and now Cruze and Territory) over the last 15 years have all been consistently in the top 10 vehicles purchased in Australia. So no one can claim that we don't build cars people don't want.

    What annoys me the most is when people complain about how much the government seems to subsidise the auto industry. Currenly, the government spends around $9 per head of GDP on the auto industry. That is not a lot of money at all to be complaining about. In the USA, the government spends close to $300 per head of GDP on their auto industry. South Korea, $270 per head of GDP. So really, not only does Australia have the most diverse range of vehicles available to its population, we as car companies are actually pretty much on our own. Its great we have all stayed afloat as long as we have in this environment.

    I cannot imagine what it would be like for Australia to not have any manufacturing anymore. We are such an isolated nation, surrounded by a fair bit of water. Just, what if, and its a big what if, something happened to all the relationships the Government has and all of a sudden we didn't have access to buying imports anymore. If we don't have a manufacturing industry here, and i'm not just saying cars now either because we have lost a huge amount of manufacturing capabilities, what would we do? Its a scary thought. Australia needs to be self sustaining.

    Sorry for the rant but the media always shows the bad news stuff so unless you are actually involved with the companies themselves, most of you will never know the truth. Never is anything good ever explained via the media and when our CEO's and Managing Directors try to explain the situation, its torn apart by the media again.

    I would be really worried about Geelong and the flow on effect the Ford closure will have on the town. I know it will be devastating for the North of Adelaide when the same eventually happens to Holden.

    Profile photo of FreckleFreckle
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    Mikal wrote:
    I cannot imagine what it would be like for Australia to not have any manufacturing anymore. We are such an isolated nation, surrounded by a fair bit of water. Just, what if, and its a big what if, something happened to all the relationships the Government has and all of a sudden we didn't have access to buying imports anymore. If we don't have a manufacturing industry here, and i'm not just saying cars now either because we have lost a huge amount of manufacturing capabilities, what would we do? Its a scary thought. Australia needs to be self sustaining.

    An old argument that doesn't hold water. We could loose any one of hundreds of components that go into manufacturing from the IP, robots, raw materials, hardware, software etc that isn't made here because of a relationship bustup. The second world war was an example of how we cope with such periods. We were as cut off and isolated as anyone could be. Manufacturing and associated skill and technologies actually increased. 

    Your biggest challenge isn't tariffs and trade barriers. It's robotics. 

    The fact is most first world manufacturing simply isn't competitive anymore. Time to change your skill set to robot technician.

    Profile photo of Jacqui MiddletonJacqui Middleton
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    While the closure is unfortunate, it is not correct to presume the entire existence of Geelong hinges on Ford.  There are well in excess of 80,000 jobs in Geelong, and Ford is responsible for only 600 of them.  That is less than 1%.  Additionally I would imagine that many of the skills used in roles at Ford will be transferrable to roles associated with aeroplane maintenance at Avalon Airport as it expands.

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    Profile photo of FreckleFreckle
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    JacM wrote:
    While the closure is unfortunate, it is not correct to presume the entire existence of Geelong hinges on Ford.  There are well in excess of 80,000 jobs in Geelong, and Ford is responsible for only 600 of them.  That is less than 1%.  Additionally I would imagine that many of the skills used in roles at Ford will be transferrable to roles associated with aeroplane maintenance at Avalon Airport as it expands.

    True but my guess is for every 1 job at Ford there's 6 – 8 in the supply chain that will be affected.

    Auto skills would not transfer to aviation. Huge difference from mass production assembly work to high tech aircraft maintenance.

    Profile photo of cathnnivcathnniv
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    Such an interesting post. Thank you.

    I much prefer to hear from the horses mouth than believe the media.

    Also like to hear good quality discussion on these points and various differing views.

    Very interesting.

    Profile photo of Richard TaylorRichard Taylor
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    I have a client who works for Ford Geelong and he tells me that he is gearing up to be busier than ever as the spares parts and service divisions are still be maintained.

    Also remember Rental Assistance is not Asset Tested.

    I have a number of properties in my SMSF that I have sold by way of a License to Occupy / Rent to Buy where i prey like mad the purchasers don't get paid work.

    Cheers

    Yours in Finance

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    Profile photo of MikalHowardMikalHoward
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    Thanks Freckle for your comment/response re isolation and how it shouldn't affect Australia. Fair point. We should be ok but still, a horrible thought to be a first world, highly developed country that does not have its own auto manufacturing sector. Say what you like, I don't believe it is a good thing to just let that disappear. I've been in the industry for 14 years now and can see first hand how it gives back to the state and the whole country. Also, quite correct on the flow on effect of job losses in the industry. For every one job loss at a major car factory, there are definitely more heads that go from the smaller feeder businesses. It's a real shame as it is the smaller businesses that ultimately get left behind completely.

    The point you made about our challenge in the industry not being tariffs and trade barriers but being robotics. I absolutely do not agree with that. Robotics has been becoming more and more prevalent in our industry yes but not ever have we lost heads because of it. Being upskilled as a tradesman to use the robots has been a good thing for the business and personally. What doesn't change is that as much as robots streamline some processes, they still are not as agile as a human being and the hand work will always still be needed. The reason the car industry is going under is purely political. Certainly since the GFC things have gotten a lot worse and it shows in the number of export programs we have lost because we cannot afford to export cars anymore to certain markets. It's not because they do not want our cars, they just are not prepared to spend mega dollars on our product.

    I appreciate all comments on the topic of the car industry. I know it has strayed from the initial post slightly but still indirectly related in that Geelong will most definitely feel the pinch from the Ford closure. I hate listening to the media and politicians because it never truthfully reflects how the car companies are doing. Only how badly they are doing. I work there so I know how we are doing. If you don't work in a car manufacturing company or in the industry itself, you just don't truly know what is going on so comments made as though you do, really hold no actual truth value. You make good points but its mostly just yours and others feelings from the media coverage you see.

    After pausing to read through my post before saving, I feel really sad and disappointed about the whole situation. I actually hope some sense prevails and the auto manufacturing sector can be saved but i really doubt it. Buy up your Falcons and Commodores now forum users because these are the last ones going to be available forever.

    Profile photo of FreckleFreckle
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    I started in the freezing works back in NZ straight out of school (1976). It was big money then. I did 4 years on lambs and then got out. Went back in 1986. The rot had set in by then. I spent another 13 years this time in pig slaughter and beef operations. The last 5 years I saw the writing on the wall and made preparations to exit at my first opportunity. Lamb processing dropped from 90 million head per year to 30. The pig processing plant went broke and closed about 2 years after I left.

    We are victims of creative destruction, deflation in manufactured goods (a race to the bottom) and globalisation. In 1980 I bought a F&P top loader washing machine for $950. I was earning $12k per year which was good money in those days. Today a comparable wage would be $80 – 100k. I can buy the same washing machine for $470. 

    And that's the problem you face. We all want cheap goods but expect to retain and improve our living standards at the same time. You can have one or the other but not both. 

    And you definitely need to worry about robots. Foxcon employs around a million people assembling electronic components. It's going robot because of labor costs and bad publicity. The people displaced for that job will then add to the competition for the remaining jobs. You can now buy simple stand alone robots for around $23k that can be programmed by anyone to take over simple menial repetitive jobs. Their economic lifespan works out to around $3/hr. Those types of robots will progressively expand into more complex jobs and actually get cheaper with longer economic life spans. 

    If you want to guide your kids into careers you need to be looking at activities that bots can't compete in. It's getting harder to find them. Bots won't do everything but they will displace enough workers to the point unemployment will be hard to manage. 

    Can you remember when every interaction was with a human? Have a think about how many times you now interact with a machine to complete a task. Where just at the beginning of that curve.

    Bots don't retire, get sick (or throw sickies) want time off, take holidays, complain or strike.

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