Filling the Glass

Airport promoters are keen to highlight how many jobs it provides, as if that is a defense for every environmental crime it commits. But if you look closely at the number of claimed jobs, you will find the job claims are grossbly exagerrated.

But the worse crime the airport commits is that it provides far too few jobs. Even if the exagerrated job claim were accepted, the airport is providing less than 10% of the jobs it could if used for better purposes.

Better Airport Employment Scheme - Bunnings Jobs

In August 2003, direct evidence of the alternative employment that could replace the airport came to light. Bankstown Airport Limited announced development of a new site for Bunnings outlet adjacent to the "innocent" drainage works carried out in 1998( see for photos).

In a brochure on this development, BAL states the site occupies 12,500 sq m or 1.25 hectare. A check of the area marked out on the aerial photograph used in the brochure indicates the site will occupy more like 2.4 ha (the marked out area corresponds with the area under construction). It seems that maybe the lower figure is just the warehouse dimension, without allowance for the car park, paths and access road. Using the higher figure of 2.4ha, and noting the claim that Bunnings will provide 200 jobs - that means a job density of 84 jobs per hectare.

Bankstown airport occupies 314 hectares (not counting nearly 30 ha of parkland/golf course), and if it were fully developed for similar purposes to the Bunnings site, it would deliver 24,400 direct jobs. That's almost 10 times the number of direct jobs the airport now provides (according to Bankstown Airport Limited's 2003 report, it employs only 2500 people). Given that the roads and car parks provided for Bunnings could be shared with other sites, it could be possible to deliver even more than this.

The Bunnings outlet will replace an existing outlet at South Bankstown, but is nevertheless claimed to produce 80 entirely new jobs. At this rate, relocating other business's to the airport would create 10,000 new direct jobs.

The number of jobs produced on the Bunnings site is just one piece of evidence. But it can be backed up with additional evidence. It is backed up by

• Job density in Bankstown Council Area
• Town Planning Text Book job density figures
• Job density in the Customs House development as KSA

Airport Job Density Indicator

If we could figure out the true number of direct aviation jobs supported by the airport, it won't mean much on its own. You need to benchmark it against what could be achieved with other uses of the airport land.

This should lead you to ask the question: How many workers would be employed in an industrial area the same size as Bankstown Airport ?

Well, Bankstown Council's City-Plan 2005 states there are 60,000 people employed in Bankstown Council's area - one third of them locals. Measuring the industrial and commercial areas that fall in Council's boundaries (counting grids on a road map) gives an estimate of about 1,100 hectares of industrial/commercial areas (including roads and other infrastructure space). Divide 60,000 by 1,100 and you find there are an average of 55 jobs per hectare.

As a check on this measure, City Plan 2005 states there are 8 sq km of commercial and industrial land = 800 hectares. This is probably based on ratable land area, and hence would not include roads and footpaths etc.,. To change the airport to something else would need allowance for roads etc.,., so stick with the 55 jobs per hectare.

Bankstown Airport occupies 330 hectares. Multiply 330 hectares by 55 jobs per hectare, and you get 18,000 jobs. Compare this with the overstated claim of 2500 jobs at the airport: the airport provides 7 times fewer jobs than can be provided by other business ventures (and the Bunnings figures suggests its worse than this)These cowboys that run airports are stealing 15,500 jobs from you !

Expected Jobs Per Hectare

Town planning text books suggest that industrial and commercial areas provide an average of 75 jobs per hectare. So the 55 jobs per hectare estimate for Bankstown is an under-achievement; correcting this would show the airport to be giving just one eighth of the jobs of an equivalent commerical area.

This textbook figure refers to full-time jobs, or the equivalent of part time jobs (for example, two 17 hour part-time jobs make up just a little less than one full-time job equivalent). Airport spruikers and politicians like to inflate the figures by talking about employed "people" or vaguely referring to jobs without adding the qualification that most of those jobs might not be capable of sustaining an independent adult.

The Bankstown wide figure reported above is based on Australian Bureau of Statistics figures for full-time jobs - and is fairly similar to the textbook figures.

But the Bunnings jobs-per-hectare figure is just 10% higher than the textbook and 50% higher than the Bankstown-wide figures. This could be because places like Bunnings employ relatively few full-time workers. It's way more profitable to employ casuals (15 to 18 year old school kids) in shifts of 4 hours or less, so you don't have to pay for breaks, overtime penalty rates, and have less people around during non-peak trading hours etc.,. There might even be exagerration - given that the data is coming from airport proponents and developers trying to gain praise for their handiwork.

But even if you halve the figures to account for this, the airport is still costing lots of full-time jobs - probably as many as 5,000 full-time equivalent new jobs. If you account for the new jobs that can be generated on the old sites moved to the airport, there's nearly 23,000 jobs being wasted by the airport. It would also be reasonable to expect that most of the airport jobs, for example those of Schofields flying school which survived a move from Schofields to Bankstown, would survive closing of Bankstown by relocating elsewhere. So the jobs wasted by the inappropriate airport location could be as high as 25,000.

All of this assumes the airport proponents job claims are correct. As will now be shown, the job claims made by the airport are impossibly high and should be not believed. Even more jobs are being wasted by the airport.

The Exagerration of Job Claims

In its 2003 Annual Report, Bankstown Airport Limited states the airport employed over 2500 people. But over the years, Airport managers have spruiked a variety of job figures - and none of them are believable.

The 2002 Annual Report claimed there were 7300 jobs - with 2400 of these classified as direct and 4900 indirectly employed jobs. In July 2002, BAL's new manager (Kim Ellis) was quoted on the front page of the Torch (24/07/02) claiming there would be 5000 jobs in an expanded Bankstown Airport.

At a Bankstown Council briefing in 1998, the Bankstown Airport Manager of the day claimed that the airport employs 3000 employees. It generated a wage bill of approximately $2.5 million dollars a week (or roughly $43,000 per employee - 13% above Average Weekly earnings at the time).

Let's pretend the 2500 claim in the 2003 annual report is correct and see if it can be refuted by reducing it to verifiable terms.

There are several ways the numbers could be exagerrated. We don't know if the counts include the Boeing (formerly Hawker De-Havilland) workers in the 2500. They have no dependence on the airport other than that it provides a heavily subsidised low cost landspace. So really they should not be included

Does it also include Aldi, Kathy's Dancing School, Belmore Autoconversions, Bankstown Grammar School, Westway Bus Depot, Echo Air Conditioners, Carpet Recyclers, a petrol station, Torch publishing, the gift shop, and various other non-aviation specific businesses leasing airport space ? In all, there are 54 hectares of airport property leased out to other businesses (BAL, 2002 Annual Report).

We could be ridiculously generous and assume none of these jobs are included in the claim for airport jobs. This will give us a very biased pro-airport estimate of its job worth.

Debunking the 2002 Jobs Claims

Let's look at the 2002 and 2003 Annual Report jobs claim more closely. The airport's primary function is to move aircraft on and off runways. What would it cost per aircraft movement if there were as many jobs related to aviation as claimed by the airport ? Does this give a credible figure that matches what pilots are paying ?

The 1998 claim by the airport manager looks like it was referring only to direct jobs. The weekly wage bill of $2.5 million tells us what each job was worth. If you scale this by the change in Average Weekly Earnings from 1998 to 2003, the 2003 weekly wage bill would be roughly $3.16 million - or $164 million per year. By the time you account for costs of payroll tax, sick leave, public holidays, superannuation, workers compensation, accomodation, supervision and other on-costs, you can add roughly 50% to this amount to get a lower-bound on the total labor costs. That would come to $240 million

But for 2002/2003, the airport collected only $1.35 million in aeronautical revenue. The wage costs are, allegedly, 180 times more than the revenue collected. There several possible explanations for this:

1. the job figure is grossly exaggerated, or
2. there's a massive cross-subsidy occurring, with rental properties subsidising aviation, or
3. there a huge amount being paid to the flight training schools (who make most of the airport movements), or other general aviation users

Later (below), this will be analysed a little more deeply to show that they equal a man-hours or dollar expenditure per aircraft movement that is demonstrably grossly exagerrated. Pilots, or their passengers and freight forwarders aren't paying the kind of money needed to justify the jobs claims. Take away the pilots etc.,. and the jobs would remain - funded by whatever is now filling the gap between the airport revenue and what funding the jobs requires.

"Airport" Job Growth

While the 1998 job claim was 3000, by 2001, pro-airport lobbyists, including some local members of Parliament, claimed it was providing 3500 jobs. In spite of the fact that aircraft movements had fallen in the meantime.

There may have been some increase thanks to the new KFC, Taco Bell and Aldi franchises built on about 1.0 ha of airport subsidised landfill in the South-West corner (the latter landfilling being an act of environmental vandalism that will impede Georges River floodwaters and increase flooding severity along the river).

But none of these businesses have anything to do with aviation, and all they show is how many more jobs you can get (500 in this case), when you turn airport land into taxpayer subsidised commercial land that is created and marketed with no regard for environmental consequences.

How to Create Jobs

A rational conclusion to make from the Bunnings job density figures is that someone really interested in creating jobs would close the airport and convert it to a business or industrial estate. Why not ask your local member why is he so keen on defending an airport which provides so few jobs compared to alternate uses ?

Off-Airport Jobs

Don't take any rubbish about the number of jobs created elsewhere.

Any business can claim that, and its very pie-in-the-sky nonsense that's impossible to substantiate. KFC for instance, provides jobs off its premises for chicken growers, people who fly chicken from breeders to growers, chicken processors, cleaners, paper & packaging makers, advertising agencies, signmakers, gas and electricity providers etc.,. etc.,. But these people would soon find jobs supplying healthier food to the public if KFC went belly-up tonight !

Equally strangely, we see a steady progression of announcement of job losses in aviation - maintenance being shipped off-shore, call centers closed, staff laid off etc.,. as foreign ownership takes over and deregulated competition powers on. So it's not quite believable that aviation is providing increasing job numbers at Bankstown or off the Bankstown site.

In July 2002, BAL's new manager (Kim Ellis) was quoted on the front page of the Torch (24/07/02) claiming there would be 5000 jobs in an expanded Bankstown Airport. What makes this particularly absurd is that the extra 2000 jobs represent about half the NSW-wide Ansett workforce (most of Ansett's 15,000 employees were Victorians). Ansett went belly-up and sacked its workers, with many accusing them of being unproductive and over-staffed. Even if a new Ansett operated out of Bankstown, a very worrying scale up for locals, there'd clearly be way less than 2000 new jobs.

Max the Axe Moore-Wilton (John Howard's former head of PM department) took over at Sydney Airport in Dec 2002, and wasted no time announcing a 40% reduction in staff in early 2003. By mid August 2003, Qantas was attacking its staff numbers by replacing full-time baggage handlers with casuals. By November 2003, Qantas was announcing it's low-cost (read low-paid staffed) new airline. Airport jobs are evaporating rapidly, and those that remain will become low-paid casual work little better than working for McDonalds.

Add to this, the recent obvious moves by the Federal Government to encourage Singapore airlines to operate domestically in Australia, and you can see what will happen. Increasingly, call centers, flight crews and their ancillary support staff will be overseas workers, who are paid well below Australian award conditions. If an expanded Bankstown airport were to provide any new jobs, they are likely to be filled by people prepared to accept third-world conditions - not Australians. And the companies' profiting from the airport will repatriate their profits overseas. Aviation will soon go the way of coastal shipping which is now operated using cheap Ukrainian crews and foreign-flagged ships.

If Kim Ellis and his mates are so convinced an expanded Bankstown will bring jobs, why didn't he put it in the sale contract - and oblige the successful tenderer to deliver a specific number of full time Australian jobs as well as $100 million or so for the airport land. As a start, bids could have been ranked by assuming each full time Australian job was worth what the community avoids in paying the dole to an individual, and add that much to the basic land leasing bid that a tenderer might submit (and multiplying of course by the number of years the airport lease deal will guarantee the jobs for).

After choosing the highest bidder, there would have to be stringent audit processes and quite severe penalties for failing to deliver on the jobs guarantee, such as termination of the lease and financial penalties matching the undelivered jobs values.

If you were to sell the airport land to the person or industry offering the highest number of guaranteed jobs, it would not go to airport uses.

Man-Hour Input Per Aircraft Movement

The airport job claims can be checked against reality by translating them into an equivalent man-hour input into each aircraft movement.

Divide the 1998 claim of a $2.5 million per week payroll by 3000 jobs and you get $833 per week per job. But this needs adjustment because the airport has significant non-business hours operation that will attract penalty rates under most award conditions.

Assume the airport operates mostly over 10 hours per day, and that 7 hours of this is ordinary time on weekdays, and 3 hours is paid to shiftworkers who get 24% loading for this out-of-hours work. On weekends, assume all 10 hours attract 25% loading. Adding this up over a week, and dividing by the 70 hours of operation, gives an average hourly loading of 12.5%. The weekly rate for each 35 hour equivalent airport job is then likely to be $833 divided by 1.125 - which equals $741. This is very close to average weekly earnings in 1998 ($735), and hence looks plausible.

To bring this forward to 2003 terms, we should scale it by the increase in average weekly earnings. For 2003, average weekly earnings was $929 per week. This is equivalent to an hourly rate of $26.75.

Each full time worker typically works only 44 weeks per year for 35 hours (after annual leave, public holidays, and sick leave are deducted). For the 3000 direct jobs, this gives 4.62 million hours of work per annum, and the 3300 indirect jobs provide 5.08 million hours of work. Now divide each of these by the 339,000 annual aircraft movements, and you find that 13.6 man hours of direct labor and 15 man-hours of indirect labor are required.

Go down to the airport, take a look around, and see if you can find any evidence of 13.6 hours of direct labor going into each aircraft movement. There's a movement every 33 seconds at around 11 am - so you won't have to look long to see the jobs figure is clearly wrong. It's hard to see evidence of even one-twentieth of that number of man-hours.

If the jobs claim was credible, you will conclude that an aircraft movement is costing a ridiculous amount of money.

For the direct job, we've got an hourly pay figure of $26.75. But to account for all the costs of employment, including office accomodation, workers compensation insurance, payroll tax, superannuation, supervision costs etc.,., we have to add further overhead. Assume its as low as 50% (in some business it's as high as 125%). The direct jobs then cost $592 per aircraft movement.

For the indirect jobs, we don't have a published figure for a weekly wage bill - and it's likely the airport managers have never conducted a survey to measure this. Let's take a low-bound estimate by assuming they are low-quality jobs paying minimum wages - say $14.00 per hour. Assume also that they are all business hours jobs, so no overtime loading is required, but that the 50% on-costs loading is required. Then the indirect jobs cost are at least $314.00 per aircraft movement.

In total, each aircraft movement thus has a labor cost component of at least $592 + $314 = $906. Cost of depreciation and non-labor maintenance costs of the airport infrastructure hasn't yet been added.

If you enquire about the hourly rate for flying training, and watch how many touch-and-go landings are done in an hour, it's very clear you're not costing anything like $906 per movement (i.e. $1812 per touch and go). The bulk of the airport movement activity is made up of the touch-and-go circuit training. The claims of even 3000 direct jobs are overstated by a large margin - perhaps 10 to 100 times too large.

Airport managers should be challenged to come clean and explain how they've cooked up their figures. Better still, have an independent survey taken that measure accurately how many jobs are directly involved in aviation.

Close Airport - Make More Jobs

If you look at the speed with which KFC, Taco Bell, Aldi and the petrol station and now Bunnings were established , you can easily see how quickly replacement jobs can be created. We don't need an airport monster to provide environmentally dangerous jobs, and it wouldn't take long to find jobs for the displaced airport workers if it closed tomorrow.

If you were even half-sensible about it, it would be easy to manage a smooth transition from airport to commercial business operations with no loss of employment continuity for the airport workers.

If you were even more sensible, you could probably figure out even better solutions that traded off some jobs for a residential and recreational area - whilst still (say) doubling the number of full-time equivalent jobs the airport provides.

Why Spruik The Jobs Line ?

In the face of these facts, it might be worth thinking about why the Labor politicians (including Opposition Transport spokesman Martin Ferguson) are so willing to spruik the jobs line.

Is it the hook they expect to use to convince you that maybe we ought to accept the airport expansion ? Remember, they are not disinterested parties - most politicians are treated by airlines as VIP's way above the status of the best business class frequent flyer. Do you think the airlines expect nothing in return for that ?

Should we quietly forget the $50,000 it's going to take off every home owner ?

Don't fall for it.

If airports were really beneficial to the community, they wouldn't need special legislation that prevents their land being sold off and used for more productive job-creating enterprises.

In the 2001/2002 Annual Report (released Dec 2002), BAL indicate that perhaps 120 ha of the airport site is available for property development. That's one third of the airport land. Judging by the Bunnings claim, we should expect these property developments to generate a large number of jobs.

The airport's new managers will try to claim these as being benefits of the airport. But they are clearly not. Rather, they just indicate the scale of benefits being lost because the other two-thirds of the airport lands are not being developed in more economically efficient ways.

A Steal of a Deal for Airport Spruikers

Let's offer the North Shore airport spruikers and their mates a deal. They can have the airport and we'll let them have the jobs too - on a take-away basis free of charge. They could take it away to anywhere they like outside the South West of Sydney. Lane Cove National Park might be a suitable location, or perhaps we could fill that nice little strip of water east of the Harbour Bridge and Kirribili House with a runway or two - just ideal with the CBD only metres away.

If you're a resident of the South West, put your local member on notice that he'd better smarten up and start selling the airport to the North Shore, or otherwise admit he has to get rid of it from Bankstown and find a better way to create jobs.

You wouldn't take a short-measure glass of beer from any publican, and you shouldn't take this nonsense from the Labor politicians or other apologists for the airport owners.

For More Information

For some very good in-depth analysis of shonky employment claims for airports (specifically Badgery's Creek) see Penrith City Council's report AIRPORT ECONOMICS: Exposing the myths of Badgerys Creek & Sydney KSA (once published on their web-site as http://www.penrithcity.nsw.gov.au/PCC/BCAsay_no9.htm, but by Sept 2002 it was gone - maybe as dead as the airport proposal ?). Penrith found faults with the claimed number of jobs which are just as valid at Bankstown, and suggest the truth is probably less than half of what is claimed.

As at 1995, there were only 20,314 people employed both directly and indirectly in air and space industries in all of NSW (ABS Stats). This includes KSA, Bankstown, Richmond, Camden, Canberra, Wagga, Orange, Coffs Harbour, Newcastle, etc.,. etc. - every airport in the state.

Yet the airport proponents have the hide to claim over 33,000 work directly on KSA airport, and another 33,000 are indirectly employed by it (Second Sydney Airport EIS). If this is how much they stretch the truth, then there are clearly many fewer than 2000 jobs at Bankstown.

It wouldn't be surprising to find that there are fewer than 1000 jobs at Bankstown Airport that could not survive the airport closure. And it wouldn't be hard to substantiate this - just stand at the airport entrances and count how many people arrive for work each day.

Perhaps this might make an interesting assignment for some budding students of statistics ?

Unlocking Airport Job Potential

SACL knows about the airports real job potential. On June 27th 2003, SACL announced the start of construction of a new customs house on about 1,500 sq m of airport land. The 10-storey 15,000 sq m building will house 650 customs employees, with staff presently located in the CBD being relocated to KSA. Divide 15,000 sq m by 650 employees and you get 433 employees per hectare - over 8 times more than we've been assuming above. Approximately 83% of customs of the 1459 customs staff in NSW are full-time, so there are about 400 full-time (assuming each part-time job is half a full time job in public service positions).

While SACL will most likely count all 650 customs staff as being airport jobs, but in fact many of them will be related to the bulk of customs work managing shipping by sea, smuggling and drug running. If the airport work dried up, the customs staff wouldn't be out of jobs - because any goods now coming in by air would come by sea instead and still need customs involvement. An alternate out-of-sydney basin airport and office site would give the customs service even lower overhead in managing its work.

It's clear that if SACL could tear up the runways and concentrate on more property projects like the Customs House relocation from the CBD, there'd be far more jobs than could ever be provided by an airport.