DO INVESTMENT ATTRACTION INCENTIVES CREATE DECENT JOBS? A STUDY OF LABOUR CONDITIONS IN INDUSTRY ASSISTANCE CONTRACTS

Abstract

All levels of government in Australia offer financial assistance in one form or another to private corporations in order to encourage, facilitate or retain business investment in their respective jurisdictions. This disbursement of public funds is often justified on the basis of the number of jobs that will be created by the assisted firm, with relatively little attention paid to the quality of these jobs. This article presents findings on the extent to which three State Governments in Australia (NSW, Queensland and Victoria) use industry assistance to influence job quality and the character of employment relations in assisted corporations. It also examines how any such conditions attached to the disbursement of financial assistance are monitored and enforced. State Governments remain less than forthcoming as to the details of these grants. Nonetheless, it is possible to draw a number of observations as to the extent to which industry assistance is and could be used in the three Australian States as a means through which to regulate job quality. We conclude by discussing the potential use of industry assistance to promote job quality in subsidised corporations, drawing on existing regulatory approaches in the United States.