Welcome to QETA Newsletter 13 2016.

I would be absolutely astounded if population growth and industrialisation and all the stuff we are

pumping into the atmosphere hadn't changed the climatic balance. Of course it has. There is no valid

argument for denial. - David Attenborough

You can't run the economy on BMWs alone. If the average person is in a pickle, how do you have a

healthy economy? - Jeremy Grantham

In New Classical theory, periods of declining employment - business cycle downturns - may be caused by

an unexpected decline in aggregate demand, which leaves workers mistakenly holding out for nominal

wages that exceed the new market-clearing level. - George Akerlof

QETA 2016 CALENDAR OF EVENTS

14 July UQ Student Day

22 July QUT Student Day

25-29 July UQ Student Economics Competition

25-29 July Economics Week

12 September UQ Student Economics Competition Presentation of Prizes

3 October Econopak 3 Published

12 October AGM

QETA NEWS 1. UNIVERITY STUDENT DAYS

Bookings are now open for the UQ Student Day on 14th July and QUT Student Day on 22nd July. Costs are

still just $5.50 per student, which include lunch – what fantastic value!! These days give students the

opportunity to hear from some prominent academic economists and to experience something of university

life.

To register, go to www.qeta.com and follow the steps from the home page. Programs can also be

accessed from the same location.

In 2015, venues were heavily booked and some schools missed out. Book early to avoid disappointment!

2. 2016 QETA UQ STDUENT ECONOMICS COMPETITION

Registration is now open for the 2016 Student Economics Competition, sponsored by the University of

Queensland School of Economics. This very popular competition consists of 40 multiple choice items for

each of Year 11 and Year 12 students. There are 10 current economic issues questions and 30 questions

relating to Core Unit 1 (Year 11) and Core Units 3 and 4 (Year 12). It’s free to enter as many students as

you wish to. We had record numbers in 2015 and would like to boost those numbers further.

There are cash prizes for the most successful students in each Year Level and every student will receive a

Certificate indicating their level of achievement.

To register, go to www.qeta.com.au and follow the steps from the home page

3. EXTERNAL ASSESSMENT TRIAL TO CONTINUE IN TERM 3

This term, trial external assessments for Year 11 students will be held in Graphics and Economics.

Economics will be an online paper. The trial process is about helping to plan for the general use of

external assessments from 2019 and preparing students and schools for successful participation.

TEACHING RESOURCE The most effective classroom layout

Here's a potentially useful infographic if you are lucky enough to have your own classroom and are

considering a bit of a revamp for next academic year:

http://tutor2u.cmail19.com/t/ViewEmail/j/B4656B5F12AEC042/AECED1810B6D435DD8E2A916412CAE5B

Food commodity footprints from Oxfam

he food sector is responsible for a large portion of greenhouse gas emissions, which drive global climate

change. The sector also relies on the labor and production of millions of small-scale farmers and

agricultural workers in the regions most vulnerable to the effects of climate change.

Explore the graphics below to see how much greenhouse gas some of the world’s major food commodities

emit — from staples like rice to speciality commodities like coffee — and the level of water scarcity in the

regions they’re grown. Also, read the stories of the farmers who grow these commodities are being

impacted by climate change.

https://policy-practice.oxfamamerica.org/work/climate-change/food-commodity-footprints/

FROM GAPMINDER

Bubbles on touch screens!

The new ⧉ Gapminder Tools are launched here: gapminder.org/tools. Our new and

improved bubble chart is now joined by an interactive income mountain and bubble

map.

The new tools:

- Work on mobiles and touch screens;

- Load faster;

- Have open source code.

Stay tuned! Translations and more to come later this year.

Please help make the tools even better! The new tools are not fully polished yet, so

check them out at gapminder.org/tools and give us feedback at info@gapminder.org. All comments are

most welcomed.

PROFESSIONAL LEARNING When opportunity comes knocking

Early bird rates have now been extended until Monday 1 August 2016 BEA Conference

It is often said that "opportunity knocks". The reality is opportunity isn't a person..we are the

opportunity..we knock and others open the door. BEA has created a new opportunity for all affiliates and

their members to come on board and attend the BEA conference in Hobart on Thursday 29 and Friday 30

September 2016. That opportunity is an extension to the early bird rate of $299 because we believe that

the chance to attend an annual first-rate conference comes rarely at this price and is worthy of your

serious consideration. On offer is the chance to network with like-minded colleagues from across

Australia, to share ideas, to hear from experts in the field and to take back our learning to our States, our

schools and our students. As an additional bonus, the opportunity to spend a few days in hospitable

Hobart awaits.

I urge you to further encourage all members to "open the door" and take up this early bird

opportunity. The early bird rate of $299 now applies until Monday 1 August 2016, after which the full rate

of $349 will apply.

I look forward to engaging in professional conversation with you at the BEA conference in Hobart.

Conference details at https://www.ivvy.com/event/BHXGCP/

Tony Kuc

President

Business Educators Australasia (BEA)

From syllabus to subject result — new resource for schools

A new poster/fact sheet titled Introducing Queensland’s new senior assessment system—From syllabus to

subject result has been mailed to all senior schools.

It explains and shows in diagrammatic form the concepts and processes in development to strengthen

senior assessment.

A PDF version and form for ordering additional hard copies are on the QCAA website.

Research and Innovation in Classroom Assessment: International Perspectives An inaugural international conference on classroom assessment is taking place in Brisbane in September.

It will provide opportunities for policy makers, researchers and teachers to explore current practice and

promote new innovations. Keynote Speakers are Professor Gordon Stobart (University of London) and

Professors Joy Cumming and Claire Wyatt-Smith (Australian Catholic University).

RESOURCES

1. FROM Oxfam

Feeding climate change

In the Paris Agreement the business community showed their support for

climate action, now this needs to be put into practice.

A new paper and interactive tool present data on the greenhouse gas

emissions and water scarcity footprints of 17 food commodities, showing

the vital role the food and beverage industry must play in tackling climate

change.

2. FROM THE ABS

6416.0 Residential Property Price Indexes: Eight Capital Cities, Mar 2016

http://www.abs.gov.au/ausstats/abs@.nsf/mf/6416.0?OpenDocument

3101.0 Australian Demographic Statistics, Dec 2015

http://www.abs.gov.au/ausstats/abs@.nsf/mf/3101.0?OpenDocument

6291.0.55.001 Labour Force, Australia, Detailed - Electronic Delivery, May 2016

http://www.abs.gov.au/ausstats/abs@.nsf/mf/6291.0.55.001?OpenDocument

6291.0.55.003 Labour Force, Australia, Detailed, Quarterly, May 2016

http://www.abs.gov.au/ausstats/abs@.nsf/mf/6291.0.55.003?OpenDocument

5368.0.55.006 Characteristics of Australian Exporters, 2014-15

http://www.abs.gov.au/ausstats/abs@.nsf/mf/5368.0.55.006?OpenDocument

5232.0 Australian National Accounts: Finance and Wealth, Mar 2016

http://www.abs.gov.au/ausstats/abs@.nsf/mf/5232.0?OpenDocument

6354.0 Job Vacancies, Australia, May 2016

http://www.abs.gov.au/ausstats/abs@.nsf/mf/6354.0?OpenDocument

5368.0 International Trade in Goods and Services, Australia, May 2016

http://www.abs.gov.au/ausstats/abs@.nsf/mf/5368.0?OpenDocument

3. FROM THE IMF

Remarks by the International Monetary Fund’s First Deputy Managing Director David Lipton

http://www.imf.org/external/np/speeches/2016/062716.htm

Managing Multi-Objective Monetary Policy: From the Perspective of Transitioning Chinese

Economy, Michel Camdessus Speech by Zhou Xiaochuan

http://www.imf.org/external/np/speeches/2016/062416.htm

IMF Survey: Euro Area At The Crossroads: No Time For Complacency Recovery in the euro area has

strengthened, but the medium-term outlook remains weak and is endangered by lack of collective action,

says the IMF in its latest review of the currency union.

http://www.imf.org/external/pubs/ft/survey/so/2016/car070816a.htm

4. FROM WORLD BANK

The 2016 edition of World Development Indicators is out: 3 features you won’t want to miss

WDI is the most widely used dataset in our Open Data Catalog and provides high-quality cross-country

comparable statistics.

—Neil Fantom, Tariq Khokhar, and Edie Purdie, The Data Blog

IDA Tackles the Toughest Global Challenges

IDA is one of the most effective platforms for

development. No other international institution has

the mandate, knowledge, and resources to respond to

complex global challenges with a focus on the world’s

poorest countries. In our increasingly interconnected

world, investments in IDA countries bring positive

spillovers for the global community, especially in

areas like climate change, health, conflict, and

fragility. Read More »

IDA 18 Replenishment Meeting: Opening Remarks by

Daw Aung San Suu Kyi

India: Investing in Children’s Early Years for a

Stronger Economy

For India to capitalize on its demographic dividend

and participate productively in the global economy, it

is critical for the country to invest in human and

cognitive development. The science is convincing:

Human development starts in the first 1,000 days of

life. Sadly, fewer than 2% of India’s children have the

right food, health care, early learning opportunities,

and clean water and sanitation. Read More »

Panama Canal Expansion: Key to Global Trade

In 2008, IFC joined four other development banks in

committing $2.3 billion in financing for the canal’s

expansion, which will be inaugurated Sunday.

Read More »

Connecting to Compete: Global Trade Logistics

Progress in logistics performance has slowed for the first time

since 2007 for the world’s least developed economies.

Read More »

Few African Countries Improve Development Policies, Institutions

While some countries have increased support for growth and poverty reduction, most saw no change or a

decline in their scores.

Read More »

10 Countries Move Up or Down in Income Groups

Each year, the World Bank revises its classification of the

world's economies based on estimates of gross national

income per capita.

Read More »

5. FROM THE RBA

A speech delivered by Alexandra Heath, at CEDA’s NSW Energy Series 2016 in Sydney, is available

on the Reserve Bank website.

http://www.rba.gov.au/speeches/2016/sp-so-2016-06-21.html

The Reserve Bank of Australia has released the Minutes of the June 2016 Monetary Policy Meeting of the

Reserve Bank Board.

http://www.rba.gov.au/monetary-policy/rba-board-minutes/2016/2016-06-07.html

A speech delivered by Guy Debelle, at the 4th Australian Regulatory Summit in Sydney, is available

on the Reserve Bank website.

http://www.rba.gov.au/speeches/2016/sp-ag-2016-06-21.html

The Reserve Bank of Australia issued the Index of Commodity Prices for June 2016. You can view this

statistical release at:

http://www.rba.gov.au/statistics/frequency/commodity-prices/2016/icp-0616.html

For your information the Reserve Bank of Australia issued the Financial Aggregates for May 2016. You

can view this statistical release at:

http://www.rba.gov.au/statistics/frequency/fin-agg/2016/fin-agg-0516.html

The Reserve Bank of Australia has released the July 2016 issue of the Chart Pack.

You can view the Chart Pack at: http://www.rba.gov.au/chart-pack/

6. FROM TUTOR2U

Understanding the Gains from Specialisation and Trade

Revision videos

This short revision video takes students through the law of comparative advantage and uses PPF analysis

to show how a country such as Malawi could benefit from specialisation and trade...

http://tutor2u.cmail20.com/t/ViewEmail/j/2A1F538238AE624E/AECED1810B6D435DD8E2A916412CAE5B

Understanding Imperfect Competition

Revision videos

This short revision video provides an overview of three forms of imperfect competition, namely monopoly,

oligopoly and imperfect competition. It considers too the likely impact of each market structure on...

http://tutor2u.cmail20.com/t/ViewEmail/j/2A1F538238AE624E/AECED1810B6D435DD8E2A916412CAE5B

Business Objectives and Pricing Strategies

Revision videos

In this short revision video we look at a range of business objectives and how they affect the price that

might be charged to consumers.

http://tutor2u.cmail20.com/t/ViewEmail/j/2A1F538238AE624E/AECED1810B6D435DD8E2A916412CAE5B

Threats to Globalisation

Revision videos

Globalisation as a process of deeper integration between countries is not inevitable. This short revision

video outlines some of the factors causing a slowdown in the growth of world trade...

http://tutor2u.cmail19.com/t/ViewEmail/j/B4656B5F12AEC042/AECED1810B6D435DD8E2A916412CAE5B

Unequal Scenes - Drones Capture Inequality in South Africa

This is a remarkable photographic resource for students and teachers wanting to understand more about

inequality in South Africa.

http://tutor2u.cmail19.com/t/ViewEmail/j/FA720AA44083917B/AECED1810B6D435DD8E2A916412CAE5B

How we make Decisions? - TV programme introducing Behavioural Economics

Last week, I caught a re-run of a BBC Horizon programme entitled 'How You Really Make Decisions', which

remains available to watch on the BBC iPlayer as well as being...

http://tutor2u.cmail2.com/t/ViewEmail/j/C45D1CA79343074D/AECED1810B6D435DD8E2A916412CAE5B

7. FROM ECONOMY WATCH

American Economic Indicators Flash Red

A number of economic indicators released recently point to a weakening American economy. Americans

are buying fewer services, manufacturing activity is down, and America’s trade deficit—along with the rest

of the world—is growing.

Read More

U.S. Economy Weakens: GDP Estimates Chopped, Factory Orders Fall

Lower factory orders and a lower growth expectation show cracks in America’s already slow

recovery. Factory orders for manufactured goods fell 1% in May, according to a new report by the Census

Bureau. That is a sharp reversal of April’s 1.8% growth for new orders of manufactured goods. Meanwhile,

shipments were almost flat, down from the 0.4% increase in April.

Read More

Russian Economy Shows Little Sign of Improvement

Russia’s GDP failed to improve as lower oil prices and Western sanctions hamper growth. Oil prices

increased in the past year, but not enough for Russia to secure economic prosperity. The Moscow Times

notes that the ruble strengthened to over 60% compared to the dollar, but has failed to enhance the

economy thus far.

Read More

8. FROM POPULATION MATTERS

New renewable energy sources were added in 2015 at the fastest rate yet, according to the Renewables

Global Status Report. 147 gigawatts of capacity was added in 2015, equivalent to the total generating

capacity of Africa

One in five plant species are now at risk of extinction from climate change, invasive species or other

causes, according to a report by the Royal Botanical Gardens, Kew. The report also found that one tenth

of plant-friendly habitats are highly sensitive to climate change.

Economic inequality makes environmental sustainability harder to achieve, according to our briefing. We

argue that the greater the inequality, the greater the risk of exploitation of people and the environment.

The world is not prepared for an increase in natural disasters brought on by climate change and

population growth, according to a report by the World Bank. Population growth and urbanization could put

1.3 billion people at risk from flooding alone by 2050.

Increasing numbers of firms are producing goods that are durable and easy to reuse. Since population

growth means that the demand for consumer goods cannot be met by the Earth’s finite resources, these

businesses are challenging today’s throw-away culture.

Apple and Samsung supplier Foxconn has replaced 60,000 of its factory workers with robots. Increasing

automation raises the question of whether fewer workers will be required in the future.

Market Participants Welcome the Weekend

By: Marc Chandler | Date: 0701/2016

The US dollar is little changed ahead of what will likely be a thin North American session due to the US

holiday on Monday. The Australian and New Zealand dollars are attracting flows, ostensibly as a place to

park funds, even though tomorrow's Australian election looks a dead heat.

Read More

IMF Warns of Uncertain Future for Global Economy in Wake of Brexit

Just days after praising the central banks of the world for preventing any notable cash shortfalls, the

International Monetary Fund (IMF) has issued a warning that the effects of the United Kingdom’s (UK)

decision to sever its relationship with the European Union (EU) will have far-reaching consequences for the

world economy.

Read More

9. FROM THE ECONOMIST

The flaws in executive pay

Bosses’ pay in the rich world is not rigged. But neither is it a perfect market

READ MORE >

The new silk road

“One belt, one road”, China’s blueprint to tie together Asia and Europe into one vast trading network,

could reshape geopolitics and the world economy

READ MORE >

10. FROM TED TALKS

Seema Bansal had a challenge: Overhaul 15,000 primary schools in the state of Haryana, in India,

and bring 80 percent of children up to grade level by 2020. Oh, and -- with no budget increase.

Bansal shares the creative, low-cost and no-cost ideas that emerged when she and her team did

something few other would-be reformers had: they listened to teachers. Watch »

11. FROM ASIC

Take a minute with your money

Watch our new video series featuring Aunty B, a wise Indigenous elder who gives the mob some great tips

on buying a car, renting an appliance and using bookup.

Money management made easy

Our new simple money manager is in nine languages and also in audio

Choosing shares to buy

How to research companies and compare market sectors when you are deciding which shares to buy.

Brush up on tax knowledge

Our video modules for students, apprentices and trainees help them prepare their tax return and track

their super.

12. FROM WORLD ECONOMIC FORUM

Small retailers transact $19 trillion in cash annually, new World Economic Forum and World

Bank Group study shows

The World Bank Group and the World Economic Forum estimated for the first time ever the value of

transactions from micro, small and medium retailers globally. It totals $19 trillion in cash and

checks and $15 trillion in electronic payments

The study proposes five key insights for companies and governments to move this $19 trillion from

cash and checks to electronic payments, as it is safer, reduces the risk of corruption, and enables

economic growth

The study includes 760 interviews and 90 innovative case studies. Global estimates were

extrapolated based on key markets including Colombia, France, Kenya, Lithuania, Morocco,

Pakistan and Turkey

View the full text here

New York, July 5, 2016 - A new study from the World Bank Group and the World Economic Forum

estimates the global value of micro, small and medium retailers’ transactions. The total value of these

transactions is estimated at $34 trillion, of which $19 trillion is paper-based transactions. Global estimates

were extrapolated based on key markets including Colombia ($145 billion), France ($950 billion), Kenya

($63 million), Lithuania ($8 billion), Morocco ($96 billion), Pakistan ($183 billion) and Turkey ($410

billion).

Findings from the study will help companies, government and nonprofits understand the barriers and

incentives for people to pay electronically. Acceptance of electronic payments by micro, small and medium

retailers is essential to expanding financial access. A basic transaction account for payments and deposits

is an entry point to the formal financial system and acts as a gateway for people to use other relevant

financial services they need to smooth their consumption and manage income shocks. The case for

payment services becomes increasingly compelling as individuals gradually move to a cashless economy,

where electronic payments are widely accepted for regular and frequent purchases.

Gloria Grandolini, Senior Director, Finance & Markets, World Bank Group said: “While many foundations

and drivers exist for achieving financial access and inclusion, the potential impact of extending the use of

digital financial services through a more widespread acceptance of electronic payments among small

retailers is substantial.”

Matthew Blake World Economic Forum, Head of Banking and Capital Markets said: “Moving away from

cash toward electronic payments can have substantial socioeconomic benefits. Moreover, substantial

business opportunities and avenues for public-private cooperation exist in better serving the micro, small

and medium segment.”

The study is part of an ongoing collaboration between the Promoting Global Financial Inclusion initiative,

World Economic Forum and the World Bank Group. Support for the study comes from the Netherlands’

Ministry of Foreign Affairs and the Bill and Melinda Gates Foundation provided through the World Bank

Group’s Financial Inclusion Support Framework (FISF) program as well as from the SME Finance Forum.

The full text can be accessed here.

Global Leaders Call for Need to Future Proof and Ramp up Climate Commitments

The Paris climate agreement, which brings the world’s two largest carbon emitters on board, is a

good first step but needs to be ramped up to address climate change

Companies need to “future proof” their operations to stay relevant in a volatile climate reality

The Annual Meeting of the New Champions 2016 is taking place in Tianjin, People’s Republic of

China, from 26 to 28 June

Follow the Annual Meeting of the New Champions 2016 (#amnc16) at http://wef.ch/amnc16

Tianjin, People’s Republic of China, 27 June 2016 – The Paris climate agreement, which brings on board

the world’s two leading carbon polluters, the United States and China, is undisputedly ground-breaking,

but visionaries at the Annual Meeting of the New Champions 2016 in Tianjin say the bar needs to be set

even higher.

“I am excited about Paris; it is a turning point. We will look back on it and see it as a shift from fossil fuels

to biofuels. But, in a couple of years we will evaluate where we are and we will see we are not doing

enough,” noted Feike Sijbesma, Chief Executive Officer and Chairman of the Managing Board, Royal DSM,

Netherlands, and a Co-Chair of the Annual Meeting of the New Champions 2016.

Under the Paris agreement signed earlier this year, China and the United States pledged to formally adopt

mechanisms to curb global warming, providing global impetus to the fight against climate change. The

deal will only come into force when ratified by at least 55 nations, representing 55% of carbon emissions.

It’s a huge first step because, together, China and the United States account for about 40%.

With the world’s two largest economies leading the way, Sijbesma said the private sector also needs to

take a “future proof” approach to mitigate the risks of climate change and stay relevant. “The companies

that are not preparing right now, not running on the premise their emissions are not unlimited, not

recognizing there are new forms of energy, those companies will not be future proof, and they run the risk

the going out of business,” he said.

Sandra Wu Wen-Hsiu, Chairperson and Chief Executive Officer, Kokusai Kogyo, Japan, agreed that the

private sector has to adapt, and fast. “If we don’t go that way, we will probably go out of business. It

enhances competitiveness. To me, it is differentiation,” she said.

Qi Ye, Director, Brookings-Tsinghua Center for Public Policy, People’s Republic of China, asked: Can we

put a cost on climate change – is the $1 billion figure being tossed around really enough?

Countering climate change will require creative financing solutions and much, much more money, noted

panellists, and that is no easy task in the current economic conditions. “The sharp decline in fossil fuels,

especially in oil, has made it much more economically challenging to promote renewable energies,”

admitted Ted Chu, Chief Economist at the International Finance Corporation in Washington DC.

Green bonds, bio-waste, energy-efficient buildings and full commitment to a carbon market are finally

becoming a reality, pointed out Zou Ji, Deputy Director-General, National Center for Climate Change

Strategy and International Cooperation (NCSC), People's Republic of China.

“We are launching the national carbon market next year. We are working very intensively to prepare for

that, to make the national carbon market happen, together with other policy instruments,” he said.

Post Paris, Zhou reiterated the need to keep moving the benchmarks forward as the impacts of climate

change reverberate across the globe. In China, he said, eyes are already on the next decade.

“We are optimistic that China can set more ambitious targets post-2020,” said Zhou, “We’re looking now

towards 2030.”

The World Economic Forum’s 10th Annual Meeting of the New Champions is taking place on 26-28 June in

Tianjin, People’s Republic of China. Convening under the theme, The Fourth Industrial Revolution and Its

Transformational Impact, more than1,700 business leaders, policy-makers and experts from over 90

countries will participate and explore more than 200 sessions over the three days of the meeting.

After Paris Climate Agreement, A World of Renewable Energy Is Emerging

While coal will remain a major source of energy for some time, growth of renewable sources is

accelerating

China’s shift to a renewables-driven energy mix and to distributed energy systems is a driver of

global change

The Annual Meeting of the New Champions 2016 is taking place in Tianjin, People’s Republic of

China, from 26 to 28 June

Follow the Annual Meeting of the New Champions 2016 (#amnc16) at http://wef.ch/amnc16

Tianjin, People’s Republic of China, 27 June 2016 – The global climate change agreement reached in Paris

at the end of last year is proving to be a game-changer in driving global shifts in the energy market,

industry experts agreed in a session on the global energy outlook at the Annual Meeting of the New

Champions 2016.

“Ever since Paris, we have observed changes in dynamics of supply and demand,” said Han Wenke,

Director-General of the Energy Research Institute (ERI) in China. “World energy is at a transition point.”

He added: “We see growth in low-carbon sources. The future energy mix will be non-fossil based, and

high-pollution, high-carbon energy sources will be phased out in the next 50-100 years.”

In this transition, a key driver is the move from centralized energy to distributed systems, in which

consumers have more control of sources of energy and how they are used. “There is a revolution in

energy around the world,” reckoned Iain Conn, Chief Executive Officer of UK-based energy group Centrica,

the parent company of British Gas. “Paris has changed things from top-down solutions to bottom-up

solutions. We now know what we need to do. But there is no single answer.”

What is clear, Conn argued, is that “power has shifted towards the customer.” With more choice in energy

sources and the growth in data on customer demand and usage, there is a shift to distributed energy

systems, which is driving further the diversification of energy sources, Conn observed. Other factors are

more widespread knowledge of how to deliver and use energy efficiently and the framing of smarter

regulation.

To be sure, fossil fuels will continue to dominate – and carbon emissions are still going to rise for some

time. “Energy is a long-term decision we have to make,” stressed Geoffrey Qhena, Chief Executive Officer

of the Industrial Development Corporation of South Africa (IDC). “It is key for industrial development. We

have to allow for coal in the medium term, while at the same time accelerating renewables.” Even a small

shift from coal to natural gas removes from the atmosphere a significant amount of greenhouse gases,

Conn reminded participants.

“The priority focus now is on low carbon,” said Gao Jifan, Chairman and Chief Executive Officer of Trina

Solar. In China and India, governments have accorded strategic importance to their efforts to promote

clean energy, he remarked. “Low carbon is inevitable. But to achieve it, we need to join forces.” This

means the collaboration of industry, technology companies particularly in the area of storage, financial

institutions to support the development of technology and new industries, and of course governments. “To

support low-carbon energy, we need clear policy measures to safeguard development,” Gao explained.

The Paris climate change agreement will be a major driver of change in the energy sector for the next 15

years, concurred Changhua Wu, Director, China, of TIR Consulting. Yet, “no matter what the scenarios,

coal will continue to be part of the energy structure, so solving the coal issue in this region is still part of

the dynamics. Clean energy requires systems change and all technologies to play a role.” Wu told

participants that cities can become major platforms for delivering the solutions needed to achieve a low-

carbon environment.

China, which is now the largest clean-energy market, will play a key role in catalysing the emergence of

the new world of renewable energy. Conn noted that China is making efforts to reduce the intensity of

energy per unit of GDP and is showing signs of opening its energy market to real competition. According

to Gao, China has ambitious plans for building its wind and solar capacity.

While the government has yet to release the energy section of its 13th Five-Year Plan, indications are that

it continues the decade-long campaign to reduce greenhouse gas emissions and provides a blueprint for

further energy-sector reforms to fit China’s goal of delivering medium-high, stable and sustainable growth.

“If China can work over the next five to 15 years to build a new energy mix, this will benefit China’s and

global development,” Han concluded.

Despite Stresses, Strong Outlook on China’s Financial Technology Sphere

There are global concerns about China’s ability to counter its high-debt to GDP ratio, manage its

domestic and currency markets, and accelerate structural reform

Concurrently, the potential of financial technology is creating a huge opportunity for China, and

helping to shift the economy towards a private-enterprise model

The Annual Meeting of the New Champions 2016 is taking place in Tianjin, People’s Republic of

China, from 26 to 28 June

Follow the Annual Meeting of the New Champions 2016 (#amnc16) at http://wef.ch/amnc16

Tianjin, People’s Republic of China, 27 June 2016 – Amid concerns of ballooning debt, capital

outflows and uncertainty about the impact of the Brexit on the global economy, participants at the Annual

Meeting of the New Champions 2016 in Tianjin are optimistic about China’s economic prospects –

especially in the financial technology sphere.

“China has a thriving ecosystem in terms of innovation, second to Silicon Valley perhaps. There are many

people with a global mindset and a lot of entrepreneurial talent,” said Mio Takaoka, Managing Director,

Monex Ventures; Executive Director, New Business Planning Office, Monex Group, Japan.

While there are global concerns about a potential economic slowdown in China, Takaoka said there is a

tendency to look first at the risks instead of the opportunities. “Looking from the outside, I believe there

are a lot of positives,” she said, “I believe China is in a relatively advantageous position in terms of

promoting innovation in finance.”

Over the past five years, 5,000 new financial technology companies have entered the market, creating

strong momentum towards private enterprise and a new, potentially more sustainable business model to

directly support the private economy.

“The future of financial technology is transformative. In the future, more capital could be invested in non-

government companies and this kind of transformation will make the real economy in China stronger,”

noted Gregory D. Gibb, Co-Chairman and Chief Executive Officer, Shanghai Lujiazui International

Financial Asset Exchange Co. (Lufax), People's Republic of China.

However, China’s mounting debt is becoming a problem that cannot be ignored, countered Yang

Yanqing, Deputy Editor-in-Chief, China Business News, People's Republic of China. “A lot of financial

organizations have argued that debt has reached 250% of GDP, and that 180% of that is from corporate

debt,” she said.

The proliferation of cheap credit to stimulate growth has seen China’s debt soar, although it still lags

behind the United States, which has a debt-to-GDP ratio of 331%. “We have several billion in debt in

stocks so we need to push forward with reform, and the bond market should be pushed to a new high

priority,” argued Jia Kang, President, China Academy of New Supply-Side Economics, People's Republic of

China. “The overall planning is global deleveraging,” he added.

To boost economic growth in the short term, the government will need to step in and rebalance, argued

Huang Yiping, Professor, National School of Development, Peking University, People's Republic of China.

“If the government wants to stabilize debt, the central government has to take some responsibility,” he

said. Huang also called for wider restructuring – including the privatization of state-owned companies – to

be accelerated, although he did acknowledge that it “won’t happen overnight”.

Speaking from an insurance perspective, Zhou Yanli, Vice-Chairman, China Insurance Regulatory

Commission, People's Republic of China, said a proper identification of the risks is required. “We want to

avoid risks and also cushion the blows,” he said, “Quantify them and showcase to the general public that

we can be practical, progressive and targeted, and also provide a good foundation at the macroeconomic

level.”

The World Economic Forum’s 10th Annual Meeting of the New Champions is taking place on 26-28 June in

Tianjin, People’s Republic of China. Convening under the theme, The Fourth Industrial Revolution and Its

Transformational Impact, more than1,700 business leaders, policy-makers and experts from over 90

countries will participate and explore more than 200 sessions over the three days of the meeting.

Chinese Premier: Downward Economic Pressures Will Not Lead to Hard Landing

China has made significant progress in transforming its economy through structural reforms, said

Premier Li

Innovation is becoming the major driver of the Chinese economy and needs to be encouraged in

individuals

The Annual Meeting of the New Champions 2016 is taking place in Tianjin, People’s Republic of

China, from 26 to 28 June

Follow the Annual Meeting of the New Champions 2016 (#amnc16) at http://wef.ch/amnc16

Tianjin, People’s Republic of China, 27 June 2016 – Persistent downward pressures will not prevent

the Chinese economy from meeting its medium-high growth target, Chinese Premier Li Keqiang assured

science, technology, business, government and civil society leaders in the opening plenary of the World

Economic Forum’s 10th Annual Meeting of the New Champions. While the global economic recovery since

the crisis eight years ago has been weak and market volatility and uncertainty have risen, China will

maintain stable and sustainable economic growth by pursuing structural reforms and promoting innovation

and new drivers of development, Li pledged.

“In the face of mounting downward economic pressure, we did not resort to indiscriminate measures,” the

premier said in his address, noting that the economy grew by 6.7% – within the government’s target

range – in the first quarter of this year. Li observed that the number of new enterprises is growing faster

than in the past two years, that the rise in domestic consumption is compensating for the downturn in

exports, and that services are now the largest sector of the economy. “The Chinese economy will not head

for a hard landing and we are capable of meeting our targets for this year. The prospects are bright.”

The World Economic Forum’s 10th Annual Meeting of the New Champions is taking place on 26-28 June in

Tianjin, People’s Republic of China. Convening under the theme, The Fourth Industrial Revolution and Its

Transformational Impact, more than 2,000 business leaders, policy-makers and science and technology

experts from over 90 countries are participating in more than 200 sessions over the three days of the

meeting.

Li acknowledged China’s key economic challenges, including the need to address the global problem of

overcapacity, make governance more efficient and continue to pursue structural reforms, including the

renewal of state-owned enterprises and upgrading of traditional industries. He stressed the importance of

helping those who have been laid off to find new jobs. Government debt levels are not so high and still

“give us space for carrying out fiscal policy,” he remarked. “The difficulties and downward pressures are

still mounting. But the fact that we have faced up to and admitted to these difficulties shows that we have

the determination to prevail over them.” Concluded Li: “Optimism is a sign of confidence.”

In response to a question, Li underscored the government’s determination to keep the economy on track:

“We are taking the hard steps to overcome those long-entrenched problems in China’s development. It is

fair to say that, if we can keep China’s economy growing at its proper range, this is the best we can hope

from this economy.”

In the face of sweeping changes driven by the technologies of the Fourth Industrial Revolution, China is

focused on stimulating innovation across the economy and society, Li asserted. “Innovation will be the

force driving us forward and bringing out the potential of everyone. That is why we are promoting mass

innovation. Even an intellectually challenged person can demonstrate genius-like talent. We must have

faith in the capacity of each individual.”

In his introduction of Premier Li, Klaus Schwab, Founder and Executive Chairman of the World Economic

Forum, outlined the challenges posed by the Fourth Industrial Revolution. Because the advances in

technology are happening so rapidly, “we need to develop regulatory principles and agile frameworks to

ensure the best and coordinated use of technology so that all global citizens can thrive in this new era.”

He added: “All of these efforts must be based not only on innovation, but also on coordination, green

development, opening up and sharing.”

Earlier, in welcoming remarks, Huang Xingguo, Acting Party Secretary of the CPC Tianjin Municipal

Committee and Mayor of Tianjin, also referred to the “momentum and sweeping impact” of the Fourth

Industrial Revolution, which he said “will completely change the traditional way of life and production and

reshape the economic landscape of the future.” He described Tianjin, which is hosting the Annual Meeting

of the New Champions for the fifth time, as “the cradle of China’s modern industry – a city that is playing

the role of a new champion with vitality.”

In China’s New Business Context, Technology Must Contribute More to Economic Growth

China needs to overcome its weaknesses in promoting innovation and commercializing technology

The digital economy can generate employment for workers who have been laid off from jobs in

sunset sectors

The Annual Meeting of the New Champions 2016 is taking place in Tianjin, People’s Republic of

China, from 26 to 28 June

Follow the Annual Meeting of the New Champions 2016 (#amnc16) at http://wef.ch/amnc16

Tianjin, People’s Republic of China, 26 June 2016 – China urgently needs to upgrade its industries by

overcoming insufficient innovation to increase the contribution of technology to economic growth, Chinese

business and government leaders concluded at a session on China’s new business context at the Annual

Meeting of the New Champions 2016. “The Fourth Industrial Revolution is upon us,” warned Ma Weihua,

President of the China Entrepreneur Club. “China faces big changes, including an ageing population. The

labour-cost advantage has been reduced. At the same time, the technology revolution is increasing

productivity.” Added Ma: “China’s Achilles’ heel is clear – our weakness in innovation and the

commercialization of technology. Technology and innovation will increase competitiveness, especially in

manufacturing.”

China has to follow the same path as Japan and other industrialized Asian economies, which shifted from

manufacturing to more capital- and technology-intensive sectors, reasoned Long Guoqiang, Vice-

President of the Development Research Center (DRC) of China’s State Council. “An important aspect of all

of this is reform. The lack of reform has stifled demand in these areas for a long time. But this demand

has to be tapped. China will create new industries; others may fall, but technologies will help them

redevelop. We have to identify the important technologies of the future.” The core of economic reform

must be to allow markets to determine the allocation of resources, explained Xu Jinghong, Chairman of

Tsinghua Holdings. “To adapt to the changing world, it is necessary to have constant innovation.”

Indications are that China is doing just that, argued Wang Jianzhou, Chairman of the China Association

for Public Companies, who noted that Chinese mobile phone production has been climbing the value chain.

Today, China accounts for 80% of mobile phones and is able to manufacture all the components and parts

required to produce a competitively priced smartphone, Wang observed. “We now have a sound supply

chain and ecosystem. This cannot be accomplished overnight. We needed a long time to cultivate the

talent and provide the training.”

“The advance of technology is unstoppable,” Liu Zhen, Senior Vice-President and Head, Strategy, China,

at Uber Technologies, told participants. “The key for China is to feel empowered by technology and not

overwhelmed by it.” The country should embrace the digital economy, which could offer new opportunities

such as employment for workers laid-off in sunset sectors, she advised. More and more people are shifting

from industry to the services sector, reckoned Ni Ying, Chief Executive Officer in China for human

resources group Fesco Adecco. This will mean disruptions – the growing need in the economy for part-

time and short-term workers, for example.

The World Economic Forum’s 10th Annual Meeting of the New Champions is taking place on 26-28 June in

Tianjin, People’s Republic of China. Convening under the theme, The Fourth Industrial Revolution and Its

Transformational Impact, more than1,700 business leaders, policymakers and experts from over 90

countries are participating in more than 200 sessions over the three days of the meeting.

Taking the Long View: How Improving the World’s Vision Could Generate $227 billion and Help

2.5 Billion People

Over $225 billion in annual global growth could be unlocked by providing eyeglasses to the 2.5

billion in the world that need – but don’t have – them

Only 8 million pairs of glasses were distributed by NGOs and inclusive businesses; $37 million or 2

cents per affected person was spent to address the problem;

With 50% of the global population (and 65% of East Asia’s) expected to be short-sighted by 2050,

a new report signals a first step by EYElliance, a new multistakeholder coalition, to address the

world’s visual divide through public-private cooperation

Tianjin, People’s Republic of China, 26 June 2016 – The provision of eyeglasses to the more than 2.5

billion of the world’s inhabitants that currently suffer from poor vision but lack access to the solution could

generate huge returns in terms of educational attainment and economic growth. This is the finding of a

new report, Eyeglasses for Global Development: Bridging the Visual Divide, published today by the World

Economic Forum and EYElliance.

The report is the first initiative of EYElliance, a new multistakeholder venture co-founded by Dr. Jordan

Kassalow, a Schwab Foundation social entrepreneur. EYElliance was convened to bring together

governments, philanthropists, businesses and the eye-care community with a specific mandate to engage

and collaborate to close the gap in access to eyeglasses.

According to the report, in 2015, NGOs and inclusive businesses collectively distributed nearly 8 million

pairs of glasses in less-developed countries. Approximately $37 million, or 2 cents per person affected was

spent by the international donor community to address the need for glasses. Without rapid remedial

action, the negative economic, educational and societal impact of poor vision could escalate, with 50% of

the world’s population – 65% of East Asia’s – expected to suffer from myopia by 2050.

Along with new data highlighting the scale of the world’s visual divide, and examples of validated, scalable

models, the report also publishes a set of recommendations for governments and businesses that are

interested in contributing to addressing this global challenge.

"We are excited to partner with Jordan Kassalow and the EYElliance to publish this important call to

action," said Hilde Schwab, Co-Founder and Chairwoman of the Schwab Foundation for Social

Entrepreneurship. "This effort is an outstanding example of how leading social entrepreneurs develop

evidence about what works and use that evidence to catalyze multi-stakeholder action for large scale

systemic change."

Madeleine Albright, lead signatory of the report and US Secretary of State (1997-2001) states: “The need

is great, but the problem is solvable. This report shows how we can harness market forces to address a

major global health problem and foster significant gains in socio-economic development.”

One of many prominent signatories of the report is The Honorable Elaine Chao, the 24th US Secretary of

Labor (2001-2009), the first Chinese American ever appointed to the President's cabinet in American

history who noted, "Proper vision enable workers worldwide to earn a living and take care of their

families. The public, private and volunteer sectors need to work together to help individuals access

affordable vision correction."

The Global Economy is Failing 35% of the World’s Talent

The Human Capital Report 2016 finds that globally only 65% of the world’s talent is being

optimized through education, skills development and deployment during people’s lifetimes

Finland, Norway and Switzerland hold the top spots, utilizing around 85% of their human capital.

Japan leads when it comes to 55 year-olds and over

Report aims to assess how public and private sector investments in education and skills can best

prepare workforces for the future and how big data and the gig economy might drive greater

opportunity for workers

Download the full report here

Tianjin, People’s Republic of China, 28 June 2016 – Rich and poor countries alike are missing huge

opportunities when it comes to making the most of their populations’ economic potential, with only 65%

on average of the world’s talent being optimized during all stages of the working life time, according to the

World Economic Forum’s Human Capital Report 2016, which is published today.

The purpose of the report is to help countries assess the outcomes of past and present policies and

investments in education and skills and provide guidance on how to prepare the workforce for the future

demands of the global economy. In addition to measuring the 130 countries that comprise the Report’s

Human Capital Index, it also analyzes a mix of public and private data from online platforms such as

Care.com, LinkedIn, Uber and Upwork to generate insights on skills gaps and the potential of the online

gig economy.

“Today’s transition to the Fourth Industrial Revolution, combined with a crisis of governance, creates an

urgent need for the world’s educators and employers to fundamentally rethink human capital through

dialogue and partnerships. The adaptation of educational institutions, labour market policy and workplaces

are crucial to growth, equality and social stability,” said Klaus Schwab, Founder and Executive Chairman of

the World Economic Forum.

The Human Capital Index 2016

Across the Index, a total of 19 nations that have tapped 80% of their human capital potential or more. In

addition to these 19 countries, 40 countries score between 70% and 80%. A further 38 countries score

between 60% and 70%, while 28 countries score between 50% and 60%. Five countries in the Index

remain below 50% in 2016.

At the top, Norway (2) and Switzerland (3) are nearly tied and gaining ground on Finland’s top

position. All three are effectively utilizing about 85% of their full human capital potential. Japan (4) rises

one rank in this year’s Index, with greater potential to be tapped by closing the gender gap. New

Zealand (6), the other country in the top 10 from the East Asia and the Pacific region, rises three ranks

since last year. Sweden (5) also rises one rank in this year’s Index, slightly outperforming its neighbour

Denmark (7). The Netherlands (8) and Belgium (10) maintain their respective rankings while Canada

(9) drops five ranks since last year.

Taking a regional perspective, on average only one region—North America—passes the 80% threshold,

even though the United States (24) lags its northern neighbour by a considerable margin. Two regions—

Western Europe and Eastern Europe and Central Asia—score in the 70% to 80% range and three others—

East Asia and the Pacific, Latin America and the Caribbean and the Middle East and North Africa—in the

60% to 70% range. Two regions—South Asia and Sub-Saharan Africa—have not yet crossed the 60%

average threshold.

Western Europe’s three largest economies all fall in the top twenty of the index, led by Germany (11)

followed by France (17) and the UK (19). The lower range in the region comprises Italy (34), Portugal

(41), Greece (44) and Spain (45). In total, the 28 current member states of the European Union

collectively achieve a group average score of 78.48, with 12 member states passing the 80% threshold.

The remaining 16 member states all make use of 70% to 80% of their full human capital potential.

The Index covers 22 countries from Eastern Europe and Central Asia. With an overall average score of

75.02, the region ranks in third place globally, after North America and Western Europe. It includes

several remarkable success stories with regard to successful human capital potential maximization,

including Estonia (15) and Slovenia (16) which both score above the 80% threshold, and the Czech

Republic (25), Ukraine (26), the Russian Federation (28), Kazakhstan (29) and Poland (30) all

scoring within the top 30. Ukraine’s performance is particularly remarkable relative to its GDP per capita

levels.

East Asia and the Pacific scores towards the middle of the range of Human Capital Index results, with

an overall average score of 69.75. The best performing countries; Japan (4), Singapore (13), and the

Republic of Korea (32) are global strongholds of human capital success, while countries such as

Cambodia (100), Lao PDR (106) and Myanmar (109) trail the region despite a relatively solid

performance relative to their income levels. China (71) scores near the regional and overall Index

average with regard to its human capital performance.

The 24 countries from the Latin America and the Caribbean region score in the middle range of the

Index, just behind the East Asia and the Pacific region, with an overall average score of 66.95. With the

exception of Cuba (36) and Haiti (111), the gap between the best and worst performers in the region is

much smaller than for any other region. Chile (51) and Argentina (56) share similar strengths and

weaknesses, passing the 70% overall human capital maximization threshold. By contrast, Brazil (83) is

lagging behind the regional average.

.

The Middle East and North Africa region comprises 15 countries that had enough data for coverage in

the Index. Of these, only one—Israel (23)—makes it into the top 30 of the Index. The Gulf states,

Bahrain (46), Qatar (66), and the United Arab Emirates (69), outperform the rest of the region in

terms of making the best use of their human capital potential. The North African nations of Morocco (98),

Tunisia (101) and Algeria (117) make up the lower end of the region’s rankings, ahead of Yemen (129)

and Mauritania (130).

The Index covers six countries from the South Asia region: Sri Lanka (50), Bhutan (91), Bangladesh

(104), India (105), Nepal (108) and Pakistan (118). The overall average score for the region is 59.92,

behind the Middle East and North Africa and ahead of Sub-Saharan Africa, and all but the top two are yet

to reach the 60% threshold with regard to optimizing their human capital potential.

In Sub-Saharan Africa, a cluster of countries, including Mauritius (76), Ghana (84), South Africa (88)

and Zambia (90) score in the 60–70% range — placing them ahead of the Middle East and North Africa

regional average and on a par with the lower half of the Latin American and East Asia and the Pacific

regions. Other economies, however, such as Ethiopia (119) and Nigeria (127) face a range of human

capital challenges, including low survival rates for basic education. With an overall average score of 55.44,

the Sub-Saharan African region is the lowest-ranked region in the Index. In total, the Index covers 26

countries from the region.

Human capital investment and planning can make a difference to a nation’s human capital endowment

regardless of where it falls on the global income scale. Creating a virtuous cycle of this nature should be

the aim of all countries. That said, there remains a clear correlation between an economy’s income level

and its capacity to develop and deploy human capital

Results by Age Group

One further finding of the Index is the unequal development and deployment of human capital across the

age group spectrum. Of the estimated 7.4 billion people that comprised the world’s population at the start

of 2016, 26% were aged under 15, a further 16% fell within the 15-24 age group, while 41% fell within

the prime working age group of 25-54 year-olds. At the upper end of the world population pyramid, 9% of

the world’s people fall within the 55-64 age group and 8% are aged 65 and over. Of these, the Index finds

that while the world has developed on average 81% of the human capital potential of under-15s, only

66% of the human capital potential of the next age group up, 15-24, has been similarly harnessed. This

group is largely being failed when it comes to preparing them with the relevant skills for a successful

education-to-employment transition. Those in the 25-54 group are similarly only making use of on

average 63% of their human capital potential while the older two age groups are likewise under-utilized,

with an average of 67% utilization in the 55-64 age group dropping to 54% for 65 and overs.

Using Big Data to Understand Skills

“The new platforms and technologies of the Fourth Industrial Revolution present unprecedented amounts

of data with which to complement official statistics, although for now these insights represent particular

membership bases, composed of digitally-connected subsets of the populations of selected economies.

Through a unique partnership, the Report leverages LinkedIn’s Economic Graph to generate further

insights - fully recognizing that unlike international data, these insights have limitations. For example,

they provide an overview of a relatively high-skilled, digitally connected subset of the populations of

selected economies:

Employers and employees need to start thinking about skill bundles, not job titles: While

employees and employers often rely on academic degrees and previous job titles to determine fitness for

a new role, a key finding in the report reveals that job titles can mean different things in different

industries and geographies. The higher the skills overlap between two industries, the easier it is to

transfer between them. For example, there is little skills overlap between LinkedIn members with the job

title “data analyst” in the market research and oil & energy industries. By contrast, data analysts in the

financial services and consumer retail industries exhibit very similar skills.

Re-skilling may be easier than we thought: Taking a focus on skills rather than jobs may broaden the

talent pool for employers – and create new opportunities for workers. For example, only about 84,000 of

LinkedIn’s 430 million members have the job titles “Data Scientist” or “Data Analyst”, a highly in-demand

profession for which many employers report shortages. However analysis of the skills reveals an additional

9.7 million members that possess one or more of the primary or sub-skills for Data Scientist and Data

Analyst, among which 600,000 have at least five of these skills. While this clearly does not make them

data scientists, data such as this provides a wider range of options for developing new talent through a

relatively modest amount of supplemental training.

Countries need to maximize learning at school and at work: Combining the Human Capital Index

findings on skills diversity acquired through education with the LinkedIn findings on skills diversity

acquired in the workforce highlights major differences across national boundaries. For example, Norway,

Belgium, Spain, Switzerland and Portugal perform well on both skills diversity in both education and the

workforce, while Australia and Romania perform relatively poorly on both areas. In the United States and

Canada, the education system enables people to enter work with a relatively diverse set of skills, but

these same people have less of an opportunity to diversify their skills in the workforce. In other countries,

including France, Brazil and Colombia, opportunities to diversify skills by ‘learning on the job’ appear to be

stronger than during the education system, where learning appears more concentrated around a narrower

set of skills.

Understanding data can help countries manage brain drain and gain: Whether driven by declining

opportunities within a country, or growing demand within others, in-demand workers go where there is

opportunity. Mapping the skills flows between economies offers an unprecedented opportunity for

governments, businesses and employees alike to understand skills hotspots in near real-time. Economic

Graph data analysed by LinkedIn for the Report shows how countries are gaining or losing in-demand

skills. For example, Australia, Chile and the United Arab Emirates are all leading their regions in gaining

technology-related skills while countries such Greece—but also Canada and Finland—are losing them.

"Creating economic opportunity for every member of the global workforce is a defining issue of our time,"

said Jeff Weiner, Chief Executive Officer, LinkedIn. "We've charted the supply, demand, and flow of talent

as we've mapped the Economic Graph, and we've uncovered clear

opportunities for governments and employers to capitalize on the potential of their workforce at

much higher rates. We're committed to providing educators, employers, policymakers, and workers with

insights, products and services that narrow skills gaps and improve economies."

Mapping the “Gig Economy”

While the potential and promise of new technologies for enhancing education and lifelong learning has

already been well documented, there remains ambiguity around the role of platform technologies when it

comes to accelerating and enhancing opportunities for the workforce. Using unique data from LinkedIn as

well as public and private data from Uber, Care.com and Upwork, the Report sheds light on the so-called

“gig economy” by revealing the diversity and range of platform-enabled work.

The Report finds that although digital formats for connecting people to work are new, the act of ad-hoc

work or self-employment is not. With a global average of 13% own-account workers, the world working-

age population is already deeply engaged in analogue formats of “gig work”. The Report also finds that

while own-account work may be growing, particularly own-account work enabled by digital platforms,

digital formats remain a very small portion of own-account work in many economies. For example, of all of

LinkedIn’s nearly half a billion members, less than 3% are freelancers. In addition, digital platforms are

growing in both the developed, emerging and developing world, where the number of own-account and

informal workers are traditionally higher. The highest numbers of freelancers are in the Media,

Entertainment & Information, Professional Services and Consumer Industries and in economies such as

Italy, Argentina and Colombia. While some of these freelancers are using technology, most are still relying

on traditional analogue ways of building relationships and accessing markets to generate returns for their

services.

Moreover, digital work platforms can span a range of both high-skilled, high-wage work and low-skilled,

low-wage work. Less evident but equally illuminating is the range of skills and wages within some of these

platforms. For example, Care.com data shows the pay premium placed on what is seen as more skilled

work, such as tutoring, as opposed to traditional care roles. In addition, platforms such as Upwork are

seeing their fastest growth in highly-developed, high-wage, specialist skills building on an already strong

base in high-skilled work. The age and gender profiles of platform economy workers are highly diverse

and do not always follow patterns in the traditional economy. Finally, to the extent that digital talent

platforms make large segments of the labour market more easily visible and measurable, often for the

first time, they also provide an unprecedented opportunity for smart regulation.

The Report concludes that instead of passive “techno-optimism” or “techo-pessimism”, it is important for

policymakers and companies to begin dialogue and action to leverage opportunities and mitigate risks.

“The new technologies of the Fourth Industrial Revolution are creating disruptions to work but they are

also providing the tools to rapidly enhance human capital. How business and governments react today will

determine which future we end up in. The Forum’s analysis seeks to provide the insights and space for

leaders to understand the changes underway and adapt quickly,” said Saadia Zahidi, co-author of the

Report and Head of Education, Gender and Work Initiatives.

The Human Capital Index ranks 130 countries on how well they are developing and deploying their human

capital, focusing on education, skills and employment. The generational lens used in constructing the

index sheds light on age-specific patterns of labour market exclusion and untapped human capital

potential. In total, the Human Capital Index covers 46 indicators, using both publicly available data and a

limited set of qualitative survey data from the World Economic Forum’s Executive Opinion Survey. Details

of the methodology can be found on the Report website.

The Human Capital Index is among the set of knowledge tools provided by the World Economic Forum as

part of its System Initiative on Education, Gender and Work. The System Initiative produces analysis and

insights focused on forecasting the future of work and skills across countries and industry sectors as well

as best practices from businesses that are taking the lead in addressing skills gaps and gender gaps. The

System Initiative also creates dialogues and public-private collaboration on education, gender and work in

several regions of the world and within industry groups.

13. FROM AUSTRALIA INDUSTRY GROUP

24.06.16

AUSTRALIAN ECONOMIC DEVELOPMENTS

In the minutes of its June board meeting, the Reserve Bank of Australia (RBA) noted that GDP growth was

better than it had expected in the March quarter, but is expected to have moderates in the June quarter.

Growth is still being driven by mining exports, as additional capacity comes online, but non-mining sectors

are also doing better. Low interest rates and the relatively low dollar are supporting stronger local

consumption, tourism and education arrivals. Government spending and investment is also increasing in

some states. Despite ongoing pressures on margins, business conditions remain above average and

business credit is gradually recovering.

The RBA also noted however, that employment growth is slowing, with the forward labour force indicators

looking mixed. Inflation and wages growth is also slow and real incomes are fairly static. This picture of

the economy is confirmed by the latest detailed jobs data for the May quarter of 2016 (released this

week), which show labour demand is slowing and is favouring part-time services jobs. In the year to May

2016, three quarters of new jobs were part-time and the healthcare sector alone accounted for 71,000

(35%) of the 210,000 new jobs added in the year.

Elsewhere this week, the NSW State Government released its Budget for 2016-17. Read Ai Group’s

analysis of the NSW economy, Budget and measures affecting business here. South Australia will release

its state budget next, on 7 July. The Federal election will be held on 2 July.

Jobs growth slower in 2016, more people working part-time

The latest detailed labour market data, released by the ABS this week, estimate that 207,000 jobs were

added to the workforce in the year to May 2016 (1.8% growth), a touch slower than a year earlier

(216,000 jobs and 1.9% growth). Most of these new jobs were added in late 2015 however, with quarterly

jobs growth slowing to 41,300 (0.3% q/q) in February and 28,500 (0.2% q/q) in May, down from 89,000

(0.8% q/q) new jobs added in the same quarter a year earlier (trend data).

The industries hiring the most new people in the year to May 2016 were health (+71,600), construction

(+44,300), retail trade (+40,700), finance (+28,000) and public administration (23,200) (trend, see chart

1 and table 1). The healthcare sector (including health, welfare and social services) now accounts for 13%

of all workers (1.5 million), although its high rate of part-time work (43.6% of its workers) means it

accounts for a smaller share (10.6%) of all hours worked. Healthcare is the most ‘feminised’ of Australia’s

industries; 78.6% of its workers are women.

Manufacturing had a small but welcome jobs recovery in 2016. Manufacturers hired an additional 9,800 in

the three months to May, but job numbers remained 15,400 lower than a year earlier, at 882,200 (trend).

Manufacturing has lost around 200,000 jobs nationally since 2008, equivalent to 18% of its 2008

workforce. Agriculture also recovered (+22,000 over the year and +5,000 in the quarter) after losing an

average of 4,500 (-1.2%) workers per year, over the previous 10 years. Less positively, professional

services and wholesale trade each shed around 20,000 workers in the year to May 2016, after adding jobs

in the previous year.

Despite the rise in employment over the year to May 2016, total actual hours worked was static, rising by

just 0.1% p.a. over the same period. 75% of the new jobs added over the year to May 2016 were part-

time (35 hours or under per week), including +43,000 part-time jobs in hospitality (but -25,000 full-time),

+20,000 in retail, +20,000 in education, +12,000 in health and +11,000 in professional services (but -

56,000 full-time). A record high 31.9% of all workers are now part-time, up from 31.1% a year earlier

and 29.0% a decade earlier. Actual hours worked per week averaged 33.3 hours in May 2016, down from

33.9 hours a year earlier and 34.6 hours a decade earlier.

Linked to this rise in part-time work, underemployment (that is, people who are working but are willing

and available to work more hours) has also grown across the economy. Most (but not all) underemployed

workers are employed part-time. Underemployment is especially significant for female workers (46% of

whom work part-time) and in the large services industries in which part-time work is most prevalent.

Female underemployment hit an all-time peak of 10.8% of all women in the labour force (that is, all

employed and unemployed women) in February 2015, at the same time as the female unemployment rate

hit 6.2%. Both rates have since fallen for women, reaching 10.3% for underemployment and 5.7% for

unemployment in May 2016. For men, the underemployment rate hit an all-time peak of 6.8% in May

2016.

Across industries, underemployment ratios tend to be higher in the large services sectors with high

proportions of part-time workers and lower average skill levels (see table 1). These include hospitality

(62% of the industry’s workers were part-time and 20% were underemployed in May 2016), retail trade

(50% working part-time and 16% underemployed in May) and arts and recreation (43% part-time and

14% underemployed in May). Healthcare has a similarly high proportion of part-time workers (43%) but a

lower underemployment ratio (9%) as of May 2016.

In other labour market data releases this week, the Department of Employment’s Internet Vacancy Index

(IVI) increased by 0.9% m/m in May and 10.5% over the year to May. The Index showed a broad range

of industries and occupations experiencing job ads growth, with stronger growth in the south-eastern

states.

All occupational groups except sales workers and machinery operators and drivers recorded an increase in

ads in the month, with professionals internet job ads growing most (+1.8% m/m). Over the year, the

strongest growth was job ads for machinery operators and drivers (+14.6% p.a.), followed by job ads for

managers (+13.5% p.a.) and professionals (+13.2% p.a.).

All other states and territories except South Australia and Tasmania posted growth in the IVI for May.

Over the year, the strongest growth in internet job ads was in the ACT (+28.4% p.a.), followed by NSW

(+15.9% p.a.), the Northern Territory (+11.9% p.a.) and Victoria (+11.7% p.a.).

1st July 2016

AUSTRALIAN ECONOMIC DEVELOPMENTS

This was the last week before Australia goes to the polls for a Federal election on Saturday 2 July. Global

events dominated the economy however, due to the results of the UK’s referendum last week on the UK

staying or leaving the European Union (‘Brexit’). The majority of eligible UK voters (52%) opted to leave

the trading bloc and UK Prime Minister David Cameron resigned in response. This historic vote by the UK

is the first step in the process of leaving the EU, with a consultation period of at least two years and a

staged implementation process to follow. Brexit has already caused increased volatility in global markets,

due to London’s pivotal role in the global financial system. The pound fell to its lowest level against the US

dollar since 1985. Brexit will likely contribute to or prolong stagnation or even recession in the UK, with

flow-on effects to Europe and other trading partners. There is much uncertainty about how the process

will unfold from here.

For Australia, the dollar initially dipped on the news of Brexit but strengthened through the week. Brexit

makes the future direction of currency markets even more uncertain. The RBA maintains some ability to

deal with potential global market ructions (i.e. it has room to cut the cash rate if needed). Brexit could

place some pressure on the RBA to cut rates further, if the dollar is pushed higher. The long-term impact

on the Australian economy is still unclear. In the near term, Brexit risks a further slowing of global growth

and global trade, which will affect Australia’s growth prospects. You can read more detail on Brexit and its

implications for Australian business here: www.blog.aigroup.com.au/brexit-what-does-it-mean-for-

australian-businesses/

Despite these destabilising events, Australian consumer confidence remained relatively buoyant this week

(see below). In other data releases, the Australian PMI® notched up to 51.8 points in June, indicating

expansionary conditions in manufacturing. The index has been expanding for the past twelve months, as

manufacturers benefit from a lower Australian dollar and better local demand (see below). ABS data for

2014-15 confirms that an increasing number of Australian businesses are becoming active exporters (see

below).

Also released this week, the World Economic Forum (WEF) ranked Australia the 18th best economy

globally for ‘human capital’ (including workforce skills, education and training capacity) in its Human

Capital Index 2016 report. This ranking for Australia was down from 13th place in 2015, but better than

19th place in 2013. Across age groups, Australians aged 15-24 years were ranked 5th best globally for

their human capital, but Australians aged 25-54 years were ranked 22nd and the 0-14 age group was

ranked 24th . Finland came 1st for its human capital in 2016.

Consumer confidence remains high at the end of June 2016

Despite the UK’s vote to leave the EU last week and the Federal election scheduled for this weekend, the

latest ANZ-Roy Morgan weekly consumer confidence index fell a modest 1.7% this week (116.8 points),

from a two-year high the previous week. The index remains 4 points above its long run average,

indicating relatively elevated optimism among consumers. The small decline this week was attributed to

less optimistic expectations on economic growth, with the “economic conditions in the next 12 months”

sub-index dropping 9% from the previous week.

Manufacturing recovery gathers pace in June 2016

Australian Industry Group’s Australian Performance of Manufacturing Index (Australian PMI®) edged up

0.8 points to 51.8 points in June (results above 50 points indicate expansion) and marking twelve months

of continuous expansion. This recovery in the Australian PMI® is linked to the lower exchange rate

(despite some periods of strengthening), which is enabling manufacturers to regain some of the

competiveness. Encouragingly, stronger recoveries in production (54.4 points), new orders (54.1 points)

and sales (53.7 points) in the Australian PMI® in June suggest further growth in the months ahead.

The employment sub-index increased by 2.3 points in June but remained in contraction, at 47.9 points.

Recent ABS labour force data confirm a mild recovery in manufacturing employment in early 2016 (+1.1%

growth in the three months to May), corresponding to some mildly positive results in the sub-index around

this time.

The strongest sub-sectors in June (three-month moving averages) were petroleum & chemical products

(62.1 points), non-metallic mineral products (58.3 points) and wood & paper products (57.7 points). The

food & beverage sub-sector lost some steam in the month (down 11.6 points to 53.7 points) but kept

expanding. Metal products (50.5 points) and printing & recorded media (50.2 points) were stable, after

extended periods of contraction. The textiles & clothing products (48.9 points) and machinery &

equipment (44.8 points) sub-sectors both contracted for the month.

Number of Australian exporters jumped in 2014-15

Data released this week by the ABS on the characteristics of Australian exporters show the number of

Australian exporters increased in 2013-14 and 2014-15, in response to the lower Australian dollar. In

2014-15, an additional 4,160 businesses (+ 9%) began exporting. This uptick in exporting businesses was

evident across both goods (mining, agriculture, manufacturing, wholesale, retail) and services firms, with

the number of goods exporters up 9% and the number of services exporters up 8%. Goods exporters

make up the majority of exporting businesses in Australia, accounting for 93% of exporting firms. The

surge in the number of exporting firms in 2014-15 was driven by smaller firms (exporting less than $1m

p.a.). Smaller exporters of goods grew by 9% p.a. (3,623 new smaller exporters of goods), with the

smallest category of exporters of goods (exports less than $10,000 p.a.) growing by 14% (1,884 new

small exporters of goods). Among the services exporters, the number of smaller firms (exporting less than

$1m p.a.) grew by 8% p.a. (162 new smaller exporters of services)

In terms of value, goods exports fell in 2014-15 (-7% p.a.), but this decline was confined to large mining

companies with exports of $100m p.a. or more (-9% p.a.) and was largely attributable to lower

commodity prices. The value of goods exports from businesses exporting less than $100m p.a. increased.

Conversely, the value in services exports increased by 10% in 2014-15, with the value of exports from

large services exporters (exports over $100m p.a.) up by 20% p.a. The value of exports from smaller

services exporters (less than $1m p.a.) fell by 13% p.a. These results suggest that in response to the

lower Australian dollar, more firms – and especially more smaller firms with goods to export - are

expanding their business into export markets.

Across industries, the largest increases for goods exporters in 2014-15 were in manufacturing (273 new

exporters, +3% p.a.), wholesale trade (262 new exporters, +2.1% p.a.) and retail trade (263 new

exporters, +6.6% p.a.). For service exporters, the largest increases were in telecommunication and IT

services (127 new exporters, +19% p.a.), financial services (79 new exporters, +86% p.a.) and transport

services (45 new exporters, +47% p.a.).

Manufacturing completes full year in expansion

The Australian Industry Group Australian Performance of

Manufacturing Index (Australian PMI®) edged up a further 0.8

points to 51.8 in June to remain above the 50-point level

separating expansion from contraction. The result completes a full

year of continuous expansion - the equal longest unbroken period

of growth for the Australian PMI®in a decade.

Ai Group Chief Executive, Innes Willox, said: “The mild expansion

of manufacturing in June capped a year in positive territory for the Australian PMI®. It was a year in which

manufacturers took advantage of the boost to competitiveness from the lower Australian dollar both in the

domestic market and in export markets. The metal products sub-sector, which has been heavily impacted

by adverse global conditions in recent times, recorded its first expansion since September 2010. The

important food and beverages sub-sector continued in positive territory although there are now signs of a

slowdown and the machinery and equipment sub sector was weaker – in part due to the low levels of

business investment across the economy and the gradual wind-down of auto assembly. The clear

imperative for the sector is for a lift in investment both within the sector itself and more broadly across

the economy,” Mr Willox said.

Australian PMI®: Key Findings for June:

The Australian PMI® expanded for a twelfth straight month in June – the longest unbroken period

of growth since September 2006 – edging up by 0.8 points to 51.8.

Five of the seven activity sub-indexes expanded in June, with the strong performance of production

(up by 3.5 points to 54.4), new orders (up by 1.9 points to 54.1) and sales (down by 2.2 points to

53.7) boding well for future months (see table below).

Six of the eight manufacturing sub-sectors expanded (that is, above 50 points in three-month

moving averages), led by petroleum & chemical products (up 2.2 points to 62.1) and non-metallic

mineral products (up 6.8 points to 58.3). Wood & paper products (down 10.0 points to 57.7) and

food, beverages & tobacco (down 11.6 points to 53.7) lost some steam, but remained in

expansion.

While metal products (up 6.4 points to 50.4) and printing & recorded media (up 0.5 points to 50.2)

lifted out of contraction, machinery & equipment (down 5.8 points to 44.8) and textiles, clothing &

other manufacturing (up 1.8 points to 48.9) remained in negative territory in June.

The input prices sub-index increased by 0.6 points in June to remain elevated at 63.8. Wages

growth continues to be volatile, with the wages sub-index dropping 5.8 points to 55.5.

The manufacturing selling prices sub-index expanded in June, climbing 2.4 points to 53.0 – the

strongest result since March 2011.

Full report (available 9.30am): www.aigroup.com.au/policy-and-research/economics/economicindicators/

Australia drops in digital competitiveness

Find out more >

WEBSITES 1. FROM WESTPAC

Westpac Australian and New Zealand Weekly

A review of the week's important data and events as well as key information affecting the Australian

market - prepared by Westpac Economics.

04/07/16 Australia & NZ weekly (PDF 318kb)

22/06/16 Westpac-MI Leading Index May (PDF 90kb)

2. FROM CBA

08/07/2016 Global financial markets are on alert .... post-Brexit risks

01/07/2016 Financial market volatility .... since the Brexit vote

3. FROM NAB

Brexit – what does it mean for the Australian economy?

The personal ties remain strong between Australia and the UK. Around 1.2 million people living in

Australia in 2015 were born in the UK, one in 20 of the population.> Read More

NAB Quarterly Australian Consumer Behaviour Survey Q2 2016

Consumer anxiety has now fallen for each quarter over the past year, as Australians respond to sustained

improvements in the labour market and recovery in the non-mining economy.> Read More

Global financial

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Commodity Update: Minerals and Energy Outlook – July 2016

Uncertainty around the outlook for commodity prices has ramped up further in the wake of the recent

Brexit decision.> Read More

Doug Cave

QETA Secretary/Treasurer

info@qeta.com.au

http://www.qeta.com.au

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