Online job claims 'laughable': commissioner

Summary:The productivity commissioner has this morning dismissed claims that a move into online retailing won't cost jobs in bricks and mortar-based stores, saying that claims to the contrary "don't pass the laugh test".

The productivity commissioner has this morning dismissed claims that a move into online retailing won't cost jobs in bricks and mortar-based stores, saying that claims to the contrary "don't pass the laugh test".

Speaking at a public hearing into the economic structure and performance of the Australian retail industry today, representatives from eBay Australia and New Zealand said that its investigations had shown that businesses could lower their costs by moving online while preserving retail jobs.

"Our initial submission also contained a fairly extensive study demonstrating if business do reform their business models and move to lower-cost models like online, it not only enables them to save costs and access the overwhelming consumer demand for online, but there isn't evidence to support that this will lead to job losses.

"It will lead to changes in the nature of skills needed potentially to support those businesses, but the arguments that suggest that online will lead to job losses are not supported by the evidence from our studies," Diana Broadhurst, eBay's senior legal counsel, told the hearing.

Productivity commissioner Philip Weickhardt told eBay's representatives that while e-commerce would improve the efficiency of the retail sector, the employment claims sounded too good to be true.

"Of course, it would be wrong to say that the growth of an e-commerce network wouldn't add employment in certain sectors like IT employment and transport; however, I think it's a bit specious to say you can lower costs and improve efficiency without having a net employment effect. I find it difficult to believe that you can improve efficiency, lower costs and improve productivity and not have an employment effect.

"I just find that the claim ... doesn't pass the laugh test," Weickhardt said.

Big retailers like Harvey Norman launched a campaign against online and offshore retailers in January, claiming that consumers shopping for their goods online are costing the Australian retail sector money and jobs. The campaign was also backed by Myer, David Jones and Target.

Ex-chairman of Electronic Frontiers Australia, Colin Jacobs, said at the launch of the campaign, however, that the job losses predicted by Gerry Harvey and his band of retailers are likely "overblown".

eBay told the Productivity Commission's hearing this morning that the skills required in the retail industry are likely to shift with a move to online, as opposed to retailers dumping staff en masse.

"I think there is going to be a shift in the nature of jobs needed," said Daniel Feiler, head of corporate affairs for eBay Australia and New Zealand.

The Productivity Commission's Sydney hearing into the economic structure and performance of the Australian retail industry is set to continue throughout the day and tomorrow.

Topics: IT Employment, E-Commerce, Government : AU

About

A fresh recruit onto the tech journalism battlefield, Luke Hopewell is eager to see some action. After a tour of duty in the belly of the Telstra beast, he is keen to report big stories on the enterprise beat. Drawing on past experience in radio, print and magazine, he plans to ask all the tough questions you want answered.

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