Sydneys job growth stifled in vain hope of shifting office jobs to suburban centres

06 June 2011

The Keneally Government was advised, just one month before the election, that its plan to shift office jobs to Liverpool, Penrith and Hurstville wouldnt work, according to the Urban Taskforce. BIS Shrapnel was commissioned by NSW Treasury to forecast the growth of Sydneys office employment and the report was handed to the government in February this year. The report was obtained by the Urban Taskforce following a freedom of information request.


The Taskforces chief executive, Aaron Gadiel, said the former government sought to cap the job growth in Sydneys inner suburbs, and restrict office precincts in the outer suburbs, in the hope this would force the construction of new office towers in suburban centres.


The former government was told that the annual growth in office jobs around Sydneys central business district should be nearly double the employment ˜capacity target in their Metropolitan Plan, Mr Gadiel said.


The Metropolitan Plan, only released in December, says that planning rules for the central business district should only allow it to grow by just 3,200 jobs a year, while BIS Shrapnel says that economic drivers should see office jobs growing at 5,200 annually.


The Metropolitan Plan also restricted Norwests capacity to an average of 570 jobs a year, when BIS Shrapnel said that office job growth should be 1,100 a year.


Other locations, like Macquarie Park, Randwick and North Sydney were limited to nearly half the jobs growth projected by BIS Shrapnel for office employment alone.


The Metropolitan Plan also banned new office precincts in the great bulk of Western Sydney that is not well served by public transport.


Mr Gadiel said that the last government capped employment numbers in Sydneys inner suburbs, and restricted new office precincts in Western Sydney, in the vain hope that it would force national firms, major law firms and banks to relocate their head office staff to outer-suburban centres.


The former government claimed that Liverpool would provide outstanding office… facilities … to underpin development of a recognisable business address. They said that Penrith will provide …. a thriving business and commercial centre, offering quality office accommodation.


Liverpools centre is supposed to grow by 500 jobs a year, Penriths central business district by 400 jobs a year, but BIS Shrapnels report says that the growth in office jobs cant even account for half of this growth.


Mr Gadiel said there was nothing wrong with being ambitious for Liverpool, Penrith or other suburban centres. Its always good to see any government work hard to attract jobs to local communities, he said.


However, it becomes a problem when the job targets in the most economically successful parts of our city have been capped, in the unrealistic hope that this will force premium office space to be built in suburban locations.


The last governments policies were more likely to drive jobs to Singapore, Melbourne and Brisbane, than to help Liverpool or Penrith.


Mr Gadiel said the Metropolitan Plan already assumes that Sydneys annual rate of job creation would permanently shrink by a quarter and that future growth would be less than half the recent annual growth rate seen in Melbourne and Brisbane.


The best prospects for the renewal of Sydneys large suburban centres lies in apartment development and new retail and other shopfront services, he said.


Disappointingly, existing planning strategies seek to reserve land in many suburban centres for commercial office buildings that wont be built in the foreseeable future, while the city continues to suffer a major housing undersupply.


The BIS Shrapnel report to the government says that 42 per cent of Sydneys extra office jobs in the next decade are likely to be in the vicinity of Sydneys central business district, 9 per cent in Norwest, 9 per cent in Macquarie Park, 6 per cent in North Sydney and 5 per cent in Parramatta.


If Western Sydney residents are to get access to the likely growth in office jobs, theyll need access to better public transport and motorways to get them in and out of the city and the other key employment hubs, Mr Gadiel said.


But well also need to provide affordable housing opportunities for office workers who cant commute every day, by supporting more apartment development in Sydneys inner suburbs.


Mr Gadiel said that it was important that the new government reviewed the employment ˜capacity targets set by the Keneally Government.


The Urban Taskforce is a property development industry group, representing Australias most prominent property developers and equity financiers.


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