PART 1
Career Strategy
Unit 4
4. Career Strategy
The Square Peg
The Economy
Structural Change
Understanding yourself
Choosing a career
Developing your career strategy
Part 1 Part 2
Sitting by yourself? Please move next to someone else!
Say “hello” and introduce yourself in groups of 2 or 3.
Today we will be talking about your future career.
In what country do you plan to work after you graduate?
What job would you like to do after you graduate?
What job would you like to be doing 10 years after you graduate?
Discussion
General Advice Warning
The content of this Unit is not personal financial advice for you
It covers general principles
… taught as part of university course based on the Australian system.
It does not take into account your situation, objectives or needs.
You are responsible to consider whether it is suitable
… for your personal circumstances.
You should consider obtaining financial and tax advice yourself.
The Square Peg
An issue of ‘fit’ The Square Peg Round Hole Game
The Square Peg
The Square Peg
1. Do nothing
2. Change the peg to be round
3. Change the hole to be square
4. Find a square hole
Alternative
The Square Peg
1. Do nothing
2. Change the peg to be round
3. Change the hole to be square
4. Find a square hole
Accept misalignment
Change yourself
Change your environment*
Move to a different environment
Alternative Meaning
* What I mean by ‘change your environment’ is to take initiative to make changes to the environment in which you work.
This might involve talking to your boss to change some of your job responsibilities. It is different from ‘Move to a different environment’
which might involve moving to a completely different job in the same organisation or moving to a different organisation entirely.
The Square Peg
Accept misalignment
Change yourself
Change your environment
Move to a different environment
Alternative Meaning
1. Do nothing
2. Change the peg to be round
3. Change the hole to be square
4. Find a square hole
5. Don’t play the game
Australia: ‘Quiet Quitting’ and ‘The Great Resignation’
China: ‘Lying Flat’ 躺平 (tǎng píng) and ‘Let it Rot’ 摆烂 (bǎi làn)
I sympathise …
It can be challenging to get a good full-time job after graduating
Long work hours* and travel time
Inadequate on-the-job training
Unreasonable expectations of managers
Bad managers, leadership and communication
Discrimination, bullying and bad behaviour in workplaces
Home affordability
Difficult to find (and keep) a life partner
The costs of raising children
* Some companies in China adopt a 996工作制 (gōngzuò zhì) working schedule which involves working from 9am to 9pm for 6 days a week.
Self-reliant for your living expenses
Buying a home to control long-term living expenses
Pay off debts (especially home loan)
Build financial independence over time
Generous with people you care about (family and friends)
Generous with the community (charity and taxes)
Work … Financial reasons
Specialise, learn new skills and improve them over time
Use your skills and abilities in a positive way to help others
Help to reduce ‘pain points’ and ‘create gains’ for society
Contributing to economic growth, create jobs and improve living standards
Meeting new people and feel part of a team
Can help to provide ‘meaning’ and a sense of ‘achievement’
Bring honour to ourselves, parents and families
Improved self-esteem and confidence
… many of these can help with ‘life satisfaction’ (eudaimonia)
Work … Non-Financial reasons
1. Understand your current and future environment
2. Understand yourself and your current situation
3. Decide on career goals aligned to you and the changing environment
4. Identify strategies to achieve your goals
5. Identify and plan for risks
6. Develop your marketing plan
7. Take action
Career Plan
The Economy
The circular flow of economic transactions
An introduction to how the economy works …
Cité de l’Économie (2014), ‘The circular flow’ on Youtube
.
Apologies in advance
for the gender stereotypes!
Economy is the sum of all transactions
$10
ProductionExpenditure
Economy is the sum of all transactions
$10
Wages, Profit, Interest, Rent
Income
ProductionExpenditure
Economy is the sum of all transactions
$10
$10
Wages, Profit, Interest, Rent
Income
ProductionExpenditure
Economy is the sum of all transactions
Circular flow
$10
$10$10
Wages, Profit, Interest, Rent
Income
ProductionExpenditure
Expenditure  Production  Income
$10
$10$10
Wages, Profit, Interest, Rent
Income
ProductionExpenditure
Expenditure  Production
Wages, Profit, Interest, Rent
Income
Production
Neo-Keynesian
John Maynard Keynes
Democrat (US) Labor (AU)
Consumer confidence
Business confidence
Big government
Expenditure
Expenditure  Production
Wages, Profit, Interest, Rent
Income
Neo-Classical
Friedrich Hayek
Republican (US) Liberal (AU)
Choices and Credit
Production and technology
Small government
Production
Neo-Keynesian
John Maynard Keynes
Democrat (US) Labor (AU)
Consumer confidence
Business confidence
Big government
Expenditure
Expenditure  Production
Wages, Profit, Interest, Rent
Income
Neo-Classical
Money (and credit)
Production of goods
Production
Neo-Keynesian
Aggregate demand
Aggregate supply
Expenditure
What causes inflation in prices of goods?
Measures total ‘final goods’ produced over a period of time
Wages, Profit, Interest, Rent
Income
 Inventories
Production
Consumption
+ Investment
+ Govt Expenditure
+ Exports
– Imports
Expenditure
Gross Domestic Product (GDP)
Measures total ‘final goods’ produced over a period of time
Wages, Profit, Interest, Rent
Income
 Inventories
Production
Consumption
+ Investment
+ Govt Expenditure
+ Exports
– Imports
Expenditure
Gross Domestic Product (GDP)
Real GDP
removes inflation
A key measure of ‘quality of life’ (especially when controlled for inflation)
per person
Income
per person
Production
per person
Expenditure
GDP per capita (per person)
Quantity and quality of land, labour, capital and entrepreneurship
Driven by …
Productivity
Land productivity
Labour productivity
Capital productivity
Entrepreneurship
per person
Income
Land
Labour
Capital
Entrepreneurship
ProductionExpenditure
GDP per capita in the long-run
Wages, Profit, Interest, Rent
Income
Neo-Classical
Friedrich Hayek
External shocks
Production and technology
Credit cycle
Policy stuff-ups
Production
Neo-Keynesian
John Maynard Keynes
Consumer confidence
Business confidence
Monetary policy
Government fiscal policy
Expenditure
GDP per capita in the short-run
Animal Spirits
Wages, Profit, Interest, Rent
Income
Neo-Classical
Friedrich Hayek
External shocks
Production and technology
Credit cycle
Policy stuff-ups
Production
Neo-Keynesian
John Maynard Keynes
Consumer confidence
Business confidence
Monetary policy
Government fiscal policy
Expenditure
GDP per capita over time
Animal Spirits
GDP per capita
(logarithmic)
time
boom
recession
It is helpful to be pluralistic*
Both Neo-Keynesian and Neo-Classical (Hayek) views are correct
Production influences expenditure
… and expenditure influences production
When the economy is going well … Neo-Classical (Hayek)
Small government, balanced budget, promote efficiency and productivity growth
During an economic crisis … Neo-Keynesian
Large government, budget deficit, promote confidence and expenditure
Australian Governments have balanced these fairly well in recent years
* What I mean by ‘pluralism’ is to recognise that more than one principle can be ‘true’ and to use the appropriate theory for the situation.
What caused the high inflation in 2022?
Energy crisis from war in Ukraine
Food and commodities (Russia & Ukraine)
Pandemic shut-downs in China
Pandemic supply chain disruption
Pandemic payments by Government
Labour shortages
Central bank bond market support*
Housing shortages
Post-pandemic profit recapture (Gouging from too much market power)
* The Reserve Bank of Australia (RBA) bought back government bonds from financial market participants (often fund managers) to keep bond prices
high, interest rates low and to provide ‘liquidity’. This was called ‘Quantitative Easing’. They did this using ‘created money’ which is inflationary.
Source: ABS
High inflation can become endemic
Businesses expect costs to rise
… so they keep increasing prices.
People expect cost of living to rise
… so they keep asking for pay rises
… independent of productivity
… which increases costs to business
… so businesses increase prices
… to recapture profit margins in a Wage Price Spiral.
Source: ABS
High inflation is bad for the economy
Cost of living for vulnerable
Uncertainty for businesses
Encourages borrowing
Discourages saving
Can create speculative bubbles
Decreases home affordability
… and requires a response! Source: ABS
That response is higher interest rates which …
Decreases new home construction
Decreases business investment
Increases home loan payments
Increases home rent payments
Increases income for retirees*(unfortunately)
Except for the last one … these all
slow down the economy and inflation
* Most self-funded retirees own significant retirement savings through their superannuation. A significant portion is invested in fixed interest
investments (such as bonds). Higher interest rates increases the return on these investments.
Monetary and Fiscal Policy
Monetary Policy (Interest Rates)
Reserve Bank of Australia
Higher rates slow things down
Lower rates not very effective at speeding things up!
… like applying the brakes of a car
… but trickier since there is a 6 to 12 month delay
Fiscal Policy (Government Expenditure and Taxation)
Commonwealth Government Budget (May)
Taxation* increases during booms (slows down)
Social security* increases in recession (speeds up)
Discretionary spending (speed up or slow down)
* The increase of taxation receipts during a boom and the increase in social security payments during a recession are called ‘automatic stabilisers’.
GDP per capita
(logarithmic)
time
boom
recession
The Economy and Asset Prices
* Share prices are mainly driven by expected future profits and so are mainly affected by expected future changes in the economy.
Also, these relationships are complex and not ‘guaranteed’. Both demand and supply factors affect property prices.
ProductionExpenditure
Income
Shocks
Monetary Policy
Fiscal Policy
Property and Shares
Imports and Exports
Energy Prices, Pandemics, War
Consumer and Business Confidence
Speculative Booms and Busts
Interest Rates, Financial Market Support
Taxation, Social Security, Discretionary Spending
The
Economy
 GDP growth results in  pressure on Property and Share Prices*
GDP
 Interest Rates results in  pressure on Property and Share Prices*
1. Career
2. Income
3. Living expenses (inflation)
4. Interest rates
5. Exchange rates
6. Investment returns (in short-run and long-run)
7. Investment risk
Why does the economy matter for this course?
1. Build your network using LinkedIn and other websites
2. Ask for advice from people you know who do have jobs
3. Consider taking temporary contract work for experience
4. Be flexible … consider areas outside your industry
5. Volunteer your time with non-profit organisations
6. Pursue further ‘specialist’ education part-time
7. Pursue further ‘generalist’ education part-time
Tips for finding a job in a recession
1. Work extra hours (unpaid) to show commitment
2. Make sure you get on well with decision-makers and co-workers
3. Be careful about updating LinkedIn
4. Help your employer find extra sources of revenue
5. Help your employer find cost reductions
6. Offer to move to a 4-day week for 20% less pay
Make sure any subsequent termination is based on full-time pay
Tips for keeping your job in a recession
1. How the Economic Machine Works
An excellent explanation of Neo-Classical Credit Cycle Theory (Austrian)
This video is assessable content for the quiz
Ray Dalio (2013), ‘How the Economic Machine Works’ on Youtube
.
(optional but brilliant)
2. Keynes v Hayek rap battle
A fun music video on ideological battles in macroeconomics!
Emergent Order (2010), ‘Fear the Boom and Bust: Keynes vs. Hayek - The Original Economics Rap Battle!’ on Youtube
Emergent Order (2011), ‘Fight of the Century: Keynes vs. Hayek - Economics Rap Battle Round Two’ on Youtube
(optional but awesome!)
This video can be difficult to
understand if English is your
second language!
4. Career Strategy
The Square Peg
The Economy
Structural Change
Understanding yourself
Choosing a career
Developing your career strategy
Part 1 Part 2

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