Let them build solar panels

While politically inconvenient, and sometimes imparting short-term pain for workers, labour market churn is crucial to productivity growth.

Yet, too often there’s a mistaken preference for guaranteeing job security over facilitating job mobility. An unyielding commitment to save all today’s jobs ultimately holds workers and the economy back.

A case in point is the angry reaction to John Kerry’s recent comments that displaced Keystone gas workers “can go make solar panels.”

But in the race to denounce the Keystone decision on any available basis, it’s disingenuous to neglect that today’s oil and gas workers can in fact become solar technicians. And even if you disagree with the environmental rationale for the decision, that transition is likely a good thing.

Individuals can and do shift work all the time — in response to incentives, price signals, and intrinsic motivations to try something new. Ultimately, that’s good for workers and makes for a more productive labour market.

Treasury research shows that slow wage growth over the past decade can be blamed on stalling mobility. Markets reward workers with transferrable skills and those that make smart — sometimes risky — transitions responsive to the economy’s needs. If that means making solar panels, then so be it.

The task for policymakers is to help more workers reap the benefits of job mobility rather than insulating them from it.

But reflexive politicisation of job losses means the wider merits of policy decisions are too readily dismissed and the options available to policymakers unreasonably constrained.

Job-saving missions typically have nakedly political purposes — shielding a political constituency or sectional interest. Possible job losses are cynically weaponised by partisans on either side of the fence as evidence of their opposition’s alleged malign intent.

Facilitating more mobility can unlock productivity gains, but requires bringing policymakers out of the political comfort zone.

However, for more workers to benefit from labour market transitions, the training sector — among others — must also be more supportive, transparent, and flexible.

It may be politically convenient — even cathartic — to castigate opponents as job-destroyers while elevating allies as job-guardians.

But weighing policy options through this vector isn’t pro-worker, it’s pro-sectional interests.