Stop believing in fairytales: Australia’s coal industry doesn’t employ many people or pay its fair s



ust as people in the Middle Ages mistakenly believed the sun revolved around the Earth, many modern-day Australians mistakenly believe our economy revolves around the coal industry. Of course, such misunderstandings aren’t an indictment of those who have been misled, but those who did the misleading.

Galileo was imprisoned for life for the “heresy” of ignoring dogma and relying on empirical evidence. And while those who rely on Australian Bureau of Statistics data to describe the Australian fossil fuel industry aren’t jailed (yet), they are certainly ostracised by the inquisitors of climate denial.


According to the government’s own statistical agency, of the 12.9 million Australian workers in 2019 only 52,100 worked in coal mining with a further 28,100 employed in oil and gas extraction. When jobs in refining and energy supply are factored in, a generous estimate of employment in the fossil fuel industry is 133,100 people.


While it’s impolite to mention ABS data when talking about the fossil fuel industry, the heresy isn’t in quoting the facts, but providing the context. Try saying on radio that coal mining employs less than 1% of the population or that McDonalds employs more people. If you really want to invite the wrath of the “sensible centre” just point out that the health and social services sector employs more than 10 times as many people as the combined fossil fuel industries.


Anyone providing such simple, truthful context to the Australian public is accused of hating working people, ignoring regional Australia, not understanding that fossil fuel exports somehow “fund” our way of life or – bizarrely, when coming from people with no training in economics – not understanding how the economy works. All of this messenger shooting is, of course, complete bullshit. But in a democracy, power is the ability to talk BS and get away with it. And no industry wields as much power in Australia as mining.

But, as a recent analysis by my colleague Dr Jim Stanford at The Australia Institute’s Centre for Future Work shows, the number of people working in fossil fuel industries is small by any measure.

According to government data, over the past five years the economy created around 270,000 new jobs per year – which means that, each year, the number of new jobs created across the economy is more than double the total number of people working in the fossil fuels industry. The Morrison government’s own Department of Employment and Skills predicts that the fossil fuel industry will account for just 0.4% of new jobs in the coming five years.


So, having established that 99% of Australians don’t work in the fossil fuel industry, let’s deal with the next stone climate denialists like to throw, that coal mining is the “backbone of regional Australia”. The government’s own data shows that it’s entirely untrue.

According to the ABS Census data, Sydney and Melbourne are among our biggest “mining hubs”. The Queensland Resource Council released some rather embarrassing research which showed that far more “inner-city elites” worked in mining industry than in any part of regional Queensland. The same data also showed the inner-city mining workers earned significantly higher pay than the workers based in regional Queensland.

The backbone of most regional economies is health and aged care. According to Stanford’s new research, of the 350 regional communities in Australia only 11 had more than 5% of people working in the fossil fuel industry. And even in those 11 most “fossil fuel intensive” regions, the number of people working in the fossil fuel industry was about the same as the number of people working in health and social services. Outside of Australia’s capital cities, health and social services employ 7.5 times as many people as the fossil fuel industry.

What about exports and taxes? Do fossil fuel exports fund our teachers, nurses and imported electrical appliances? Well, no.

First of all, exports don’t pay for imports. At all. When the Swiss-owned Glencore sells a billion dollars of Australian coal to a Chinese steel mill, there’s no reason why the cheque from China would ever land in an Australian bank account. The idea that “exports pay for imports” is as widely held as it is completely wrong. Most of the revenues from exported fossil fuels go to the owners of the mines and gas wells. Export revenues don’t come to me, you, or the government.

And then there is tax. According to the Australian Tax Office, coal and oil companies such as Yancoal and ExxonMobil haven’t paid tax on their Australian revenues in the last six years. None.


As for the rest of the fossil fuel industry, billions of dollars in tax revenue sounds like a lot until you realise that commonwealth revenue was $470bn last year and national income (GDP) was $1.9tn. Put simply, the income tax and GST paid by teachers, nurses and retail workers dwarfs the tax paid by the fossil fuel industry.

So here we are, living in one of the richest countries in the world with, supposedly, a free press and a healthy democracy, collectively believing the fake news that Australia owes jobs, imported consumer goods, and even our teachers and nurses, to a fossil fuel industry that clearly does not employ many people or pay its fair share of tax.

Fossil fuel extraction provides an important source of income to a small number of people in a small number of regions. Whether the world continues to transition away from fossil fuels or not, most of the people working in Australian coal mines will retire or lose their jobs to robot trucks, trains and drilling equipment in the decades to come.

But despite the overwhelming evidence of the Morrison government’s own data, too many Australians are led to believe that Australia is uniquely troubled when it comes to tackling climate change and transitioning away from fossil fuels.

What better time of year to remember that some beliefs are based on fairytales and even children stop believing in Santa Claus … eventually.

• Richard Denniss is the chief economist at independent thinktank The Australia Institute

Featured Posts