Money

I Walked Around Northern Adelaide to See What a Downturn Looks Like

I grew up in Elizabeth, where everyone worked at Holden. Now it's a picture of South Australia's economic decline.

by Royce Kurmelovs
Jul 28 2015, 2:30pm

Abandoned blocks like this are everywhere. The house burns down and the land collects rubbish.

The neighbors don't know when the house burned down, all they know is that it was missing when they moved in five years ago and no one's touched the land since. Even if someone does demolish what's left, they say it'll be some property developer who will stuff the block with units.

In the States, they call them gun rows. Cheaply built houses with low ceilings, crammed onto a single block and rented at premium rates. You can see them going up all around this neighborhood, another sign Elizabeth's best days are done.

Elizabeth's official name is the City of Playford. It's a 50-minute drive north of Adelaide, Australia, a cluster of suburbs along metropolitan Adelaide's fraying edge that 80,000 people call home. It's not famous for much, except maybe the Holden factory and Jimmy Barnes.

When I was a kid, this was a furniture shop. Next door was a hardware place. Now all that's left is the liquor store.

Barnsey and my father grew up on the same streets. One recorded Working Class Man, got out of Elizabeth, and became an Australian icon. The other became a tradesman. Elizabeth, the latter tells me, was never really a nice place, but it was never truly awful either. Now, when I drive past his childhood home on Main North Road, it's to write about how Elizabeth, and the rest of the state has simply not enough money, or prospects, to maintain its population.

Back in 1981, there were 100,000 manufacturing jobs in South Australia. By 2011, that number had fallen to 74,000. Then in December 2013 General Motors announced it would close the Elizabeth plant by 2017. The last time a car factory shut down in the state was 2008 and a third of the people laid off never worked again. This time around, it will kill off Australia's last complete manufacturing chain and put a projected 23,903 people out of work in South Australia as well as 98,483 in Victoria.

This place was a furniture factory. Now it's a community art project.

Last year Canberra also said it wanted to offshore the building of warships and submarines to Japan, or Germany, or Spain. No one's quite sure which, but the average guy in Elizabeth knows that building warships and submarines is big business in South Australia. If it goes too, it would take thousands more jobs from what's already been called a valley of death.

South Australia has around 800,000 jobs for its 1.2 million people. This put unemployment at 8.2 percent last month as the rest of the country got by on six. Those figures, however, are fuzzy and some peg the numbers much higher at 12 percent.

Two in five young people in Elizabeth out of work, and while the services, health, and retail sectors made up the bulk economic activity at the 2011 Census, manufacturing still accounted for 10 percent. By comparison, the state's famed agricultural sector, which exported $2.4 billion to Asia in the 2013-2014 financial year, provided just one percent of SA jobs.

The inside was a ruin and it's clear no one had kept pets there in years

All up, South Australia is facing what Premier Jay Weatherill has euphemistically called a period of significant difficulties. Despite this, the message from the top is to stay positive. A combination of low interest rates and a falling Australian dollar will be good for the state in the long run, they say.

The word for what the greater Adelaide region is going through is deindustrialisation. Manufacturing, or the ability to add value to raw material, is the backbone of an economy. Wherever the industry suddenly contracts, it creates an employment gap that is hard to fill. For many years the decline has been more of a slow rot, but as 2017 approaches it will speed up. Whatever happens next is anyone's guess.

The inside of a dog-less home

When making these assessments, people often bring up Detroit. It is the first name that drops in the minds of factory workers and politicians, bar-stool economists and street-corner intellectuals. Detroit may be the worst-case scenario, but that fact alone makes it unlikely. A more accurate comparison would be the Spanish city of Bilbao. In the 80s, at the height of Bilbao's economic crisis, one in four for its 1 million inhabitants were unemployed. The city was forced to change or die. Now it's a post-industrial success story.

How Adelaide will cope with it all is an open question, as no two cities are alike. The only safe prediction is that things in Elizabeth will stay bad for a while. So bad that local politicians are spinning the opening of the latest Hungry Jacks franchise as "good for local jobs".

The South Australian state government is working to stay positive and sell its vision for the New Economy. Arts, tourism, food, and wine is the future, just like Bilbao, but then these industries have never been well-known for the size of their paychecks. Try raising a family on a bartender's wage. Or a Federal arts grant. And even O-I, the company making wine bottles for the Barossa, has been shutting down furnaces because there just isn't the volume. Wine in bottles is for good times, not bad ones.

Handprints. These killed me.

As I walk through my old neighborhood I see the people already affected. The people in trailer parks and neighborhoods with boarded up houses. The people out on the street during the middle of the working day. The people too afraid to speak on record because the thugs around the corner jumped them one night and might find out. It's American living, they'll tell you. Australia's very own slice of the American Dream.

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