Since the end of the recession we ‘had to have’, Australia’s official unemployment rate has continued to tumble. Ongoing economic growth, coupled with an increased level of labour-market flexibility, has helped create a host of new jobs to service the Australian economy.
In December 2004, the official unemployment rate sank to just 5.1 per cent—the lowest rate in 28 years. However, today’s labour market is a very different place to that of 28 years ago.
The ongoing casualisation of the labour force, complicated by the large numbers of hidden long-term unemployed, underemployed and ‘demotivated’ jobseekers, has left the labour market at a critical juncture. It’s important that while celebrating the low unemployment rate, the federal government’s employment agenda keeps sight of the big picture: as Australia’s full-time employees spend longer hours at work, the ranks of Australia’s part-time ‘working’ nation continues to grow.
The difficulty stems from the way we measure unemployment in Australia. The Australian Bureau of Statistics (ABS) counts people as employed even if they spend as little as one hour a week working, and spend every subsequent hour actively seeking a job. If a million Australian employees were involuntarily shifted from full-time to part-time hours tomorrow, there would be no impact upon the official rate.
Official unemployment fell to just 520,000 people in December 2004; however, if we were to take into account the unemployed and underemployed currently excluded by this measure, a lack of work remains a major financial burden for more than 1.5 million Australians. And given that there are a million households living below the poverty line despite the fact that one or more adults in the household works, we start to see the new phenomenon facing Australian workers: a job is no longer a guaranteed path out of poverty.
That 87 per cent of the jobs created in the 1990s paid less than $26,000 a year, or that two out of every three jobs created in the last three years pays less than $600 a week, is perhaps the best illustration of the fact that a job is no substitute for good employment policy.
The main reason that these new jobs pay so badly is that the majority of the growth has been in part-time employment. In fact, for every four new part-time jobs, only one full-time position is created.
As a result of this trend towards part-time employment there were, by July 2004, 2.8 million part-time