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Category: Employment & Unemployment

  • Solving the crisis: Raising the living standards of Australian workers

    Employment & Unemployment, Future of Work, Inequality, Labour Standards & Workers’ Rights, Social Security & Welfare, Unions & Collective Bargaining, Wages & Entitlements

    Solving the crisis: Raising the living standards of Australian workers

    by Lisa Heap

    Author

    Lisa Heap

    Senior Researcher

    Media release



    Feeling hopeless? You’re not alone. The untold story behind Australia’s plummeting standard of living

    Productivity might be the word on everyone’s lips in the lead up to the Albanese Government’s Economic Reform Roundtable  however weak productivity isn’t the cause of many of the problems experience by workers in Australia today nor is increasing productivity the solution. Rapid inflation after the pandemic, combined with rising interest rates and slow wage growth, left many Australian households struggling to afford necessities. The Reserve Bank’s (RBA) blunt strategy of raising interest rates to slow the economy post the pandemic both misdiagnosed the drivers of inflation and harmed Australian workers who struggled to manage increased mortgage repayments and other debts. The root causes of Australia’s post pandemic crisis—rising corporate profits, unjustifiable price hikes, and deep wage stagnation were ignored by the RBA.

    Despite a reduction in inflation and interest rates, too many Australians are still experiencing lower living standards after the turbulent events of the past five years. Official inflation figures may capture broad economic trends however, they do not adequately describe the real pressures experienced by working people—particularly when it comes to the impact of the increasing costs of essentials like food, housing, and energy. Australian workers can ill afford another round of RBA driven unemployment, austerity, and uncertainty.

    What will it take to repair the damage to Australian workers’ living standards?

    In a new publication, Solving the Crisis: Raising the Living standards of Australian workers, some of Australia’s leading progressive economists and social policy analysts explain what is going on and how to fix it. The origins of the current crisis in living standards are documented. A progressive policy agenda for a second term Albanese Government is advanced.

    The multidimensional policy agenda in Solving the Crisis calls for

    • increases in real wages
    • achieving full employment
    • better quality jobs and greater assistance and respect for those seeking employment
    • strengthening public services (including health care, childcare, aged care and education)
    • making fair and affordable housing available
    • developing a well-planned and supported transition to renewable energy sources.

    The key to the success of this agenda is centering the experience of workers’ and their families.

    Australia should adopt a progressive multidimensional economic agenda that lifts living standards, reduces inequality, and strengthens democracy, rather than a narrow concentration on productivity. Uniting people behind this progressive economic agenda helps counter the trend towards increasing inequality, division and conflict, that has been present in other countries.

    How to solve the living standards crisis

    Four policy papers are the core of  Solving the Crisis. These papers examine the main drivers of inequality and deteriorating living standards in Australia

    • Greg Jericho examines how inflation is misunderstood when disconnected from wage growth. He proposes a shift in Reserve Bank policy and a renewed focus on promoting real wage increases.
    • Peter Davidson  argues that growing inequality is not inevitable. Through strengthening the four key policy pillars – income support, minimum wages, full employment, and employment services – minimum incomes can be raised and inequality reduced.
    • Thomas Greenwell highlights how decades of declining collective bargaining and high underemployment have undermined living standards. He calls for renewed support for unions, stronger collective bargaining systems, and a focus on full employment in macroeconomic policy.
    • Charlie Joyce revisits the concept of the social wage—and argues that rebuilding and expanding the social wage can raise living standards, promote inclusion, and restore trust in democratic institutions.

    Together these papers provide practical policy solutions forming a platform for economic reform.

    Solving the Crisis helps working people to help cut through economic misinformation and political spin, offering a clear lens on the structural factors that have driven inequality and declining living standards.

    Progress is happening

    In its first term the Albanese Government has made cautious progress on living standards. This progress includes labour market reforms that have contributed to stronger wage growth. These reforms include supporting increases in the minimum wage, facilitating collective bargaining in hard-to-organise industries, funding support for wage increase in early childhood education and aged care. Cost-of-living measures, like energy rebates and expanded renter assistance, also provide important support to hard-hit households. Meanwhile, the easing of interest rates by the RBA—better late than never, may support future growth and job-creation.

    However, while prices are growing more slowly, the levels of many prices remain too high—especially for necessities like food, housing, and energy. Wages growth may have commenced however at the current pace, it will take several years to repair real wages, and restore the same purchasing power for workers they enjoyed before the pandemic. The quality of public services (another critical determinant of living standards) has been damaged by underfunding and overreliance on privatised provision, the costs of which we are currently seeing in early childhood education and care. Minimum income payments such as Jobseeker remain woefully inadequate. The system designed to support and assist people from unemployment into decent jobs is broken beyond repair. Meanwhile, global economic and geopolitical uncertainty threatens to derail this modest recovery before it really gets going.

    More work to be done

    At the 2025 federal election the Australian people rejected political parties proposing cuts to public services, short-term fixes (like petrol tax cuts), and the politics of division. In its second term the Albanese Government has a unique opportunity to implement progressive policy changes such as those contained in Solving the Crisis.

    More details about Solving the Crisis and additional resources are available at https://www.carmichaelcentre.org.au/living_standards.



    Solving the Crisis: Raising the living standards of Australian workers

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  • Productivity in the Real World

    Employment & Unemployment, Tax, Spending & the Budget, Wages & Entitlements

    Productivity in the Real World

    What it is, what it isn’t, and how to make it work better for workers
    by Jim Stanford

    Author

    Jim Stanford

    Media release



    Australia does not have a “productivity crisis” – new research

    Claims that Australia faces a productivity crisis are overblown. Weak productivity didn’t cause the current problems facing Australian workers (falling real wages, high interest rates, unaffordability of essentials like housing and energy). Nor will higher productivity fix these problems.

    Faith that higher productivity will automatically trickle down, to be shared by all workers, is unfounded. Pro-active measures to lift wages and living standards are needed if stronger productivity growth is to support stronger living standards.

    This report presents empirical evidence showing that productivity growth in recent decades has not been equally reflected in higher real wages and better living standards.

    • Productivity grew four times faster since 2000 than average wages adjusted for consumer prices; it grew almost twice as fast as average wages adjusted for producer prices.
    • If workers had received wage increases since 2000 that matched productivity growth, wages would be as much as 18% higher than they are at present – worth $350 per week, or $18,000 per year.
    • Over time, the failure of wages to keep up with productivity has created a “productivity debt” effectively owed to workers, worth hundreds of thousands of dollars per worker.

    The fruits of productivity growth have been disproportionately captured in the form of business profits, dividend payouts, and executive compensation. It is only through deliberate measures to ensure productivity growth is reflected in improved compensation and conditions for workers that Australian workers can have any confidence their contributions to improved productivity will pay off in better lives. Repairing the link between productivity and mass prosperity, by strengthening the institutions of distribution and pushing wealth downward (rather than hoping it will trickle down automatically), is as important to Australia’s future productivity as any labour-saving technological breakthrough.

    The report concludes with a broad agenda of high-level policy themes that should be pursued to challenge and support Australian workplaces to become more productive – and to ensure the resulting gains are broadly shared.



    Productivity in the Real World




    Factsheet
    Australia does not have a “productivity crisis” – new research

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  • Briefing Paper: Restoring public sector capability through investment in public service employees

    Employment & Unemployment, Future of Work, Gender at Work, Governance & Government Agencies, Labour Standards & Workers’ Rights, Public Sector, Procurement & Privatisation

    Briefing Paper: Restoring public sector capability through investment in public service employees

    by Lisa Heap

    Author

    Lisa Heap

    Senior Researcher

    The Australian Public Service (APS) is responsible for delivering some of the most crucial social services to all Australians. The APS workforce includes employees who deliver frontline services like in Medicare and Centrelink, those who administer the National Disability Insurance Scheme (NDIS), and those who assist service personnel and veterans via Veterans Affairs. These are just some of the functions that APS employees undertake. Behind front line service delivery staff are employees who support these staff, work to coordinate and integrate services and provide policy and regulatory advice to government.

    This briefing paper examines the make-up of the APS and considers recent efforts to improve APS service delivery. We conclude that recent investment in the employment of more APS employees has improved service delivery and that any reduction in APS employees will reduce service delivery or result in the engagement of more consultants and contractors.

    In this paper we debunk several of the myths promoted in the political debate around the size of Australia’s public service. One such myth is that Australia’s public service is “bloated” or “inefficient”. The research also found that despite claims to the contrary, most of the public service jobs created since 2022 were not based in Canberra.



    Restoring public sector capability through investment in public service employees

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  • Submission to Industrial Relations Victoria Inquiry on Restricting Non-Disclosure Agreements (NDAs) in Workplace Sexual Harassment Cases

    Employment & Unemployment, Gender at Work, Labour Standards & Workers’ Rights, Wages & Entitlements

    Submission to Industrial Relations Victoria Inquiry on Restricting Non-Disclosure Agreements (NDAs) in Workplace Sexual Harassment Cases

    by Lisa Heap and David Peetz

    Authors

    Lisa Heap

    Senior Researcher

    David Peetz

    Laurie Carmichael Distinguished Research Fellow

    It is generally reported that NDAs can benefit victim-survivors by providing anonymity and privacy where that is the victim-survivor’s choice. However, it is also reported that power imbalances between victim-survivors on the one hand and perpetrators and employers/organisation on the other have left workers feeling they had little choice but to sign NDAs.

    NDAs have had the impact of silencing victim-survivors, disguising the actions of perpetrators and covering up the prevalence of sexual harassment and other forms of gender-based violence and harassment within organisations. At times, this has enabled harassers to remain in the same workplace or move within industries and continue to engage in sexual harassment.

    The focus of this submission is on the issues of transparency associated with NDAs and the impact of these agreements on public interest concerns regarding the prevention of sexual harassment and other forms of gender-based violence and harassment at work. We believe that greater transparency regarding the practices associated with settling sexual harassment claims will lead to greater accountability. This accountability should be supported by legislative reforms that mandate minimum conditions such as those set out in this submission.



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  • Taking up the Right to Disconnect? Unsatisfactory Working Hours and Unpaid Overtime

    Employment & Unemployment, Future of Work

    Taking up the Right to Disconnect? Unsatisfactory Working Hours and Unpaid Overtime

    Go Home on Time Day 2024 Update
    by Fiona Macdonald

    Author

    Fiona Macdonald

    Acting Director, Centre for Future Work

    This year marks the sixteenth annual Go Home on Time Day (GHOTD), an initiative of the Centre for Future Work at the Australia Institute, that shines a spotlight on the maldistribution of working hours and the scale of unpaid overtime worked by Australians.

    The Australian labour market has remained relatively strong over 2024 although interest rate rises have pushed unemployment to over four per cent. Recent growth in wages has not been enough to take pressure off household budgets, or to offset the major reductions in real wages that occurred following the COVID pandemic. Across the economy, large numbers of workers want more paid work hours. However, the underemployment problem co-exists with overwork and with unpaid overtime that contributes to the loss of substantial amounts of income for working households.

    During the past two years there has been a great deal of public attention and debate about a right to disconnect from work outside work hours. New “Right to Disconnect” laws came into effect in August 2024. While it is early days, these laws could already be having a positive impact including through raised awareness that workers should be free to enjoy their personal time without work demands. Our research indicates that unpaid overtime hours were fewer in 2024 than in previous years, both pre- and post-COVID pandemic years.

    Unpaid overtime
    On average, employees reported they performed 3.6 hours of unpaid work in the week of the survey, equivalent to       10.9% of total working hours.  This unpaid overtime equates to 188 hours per year per worker, or almost five standard 38-hour work weeks.

    •  If  unpaid overtime were valued at median wage rates, this means the average worker is losing $7,713 per year or $297 a fortnight.
    • At the economy-wide level, this equates to more than $91 billion of lost income per year.

    The personal and social costs of unpaid overtime, through working outside of normal hours, include negative consequences for health and wellbeing and relationships:

    • Four in ten workers report physical tiredness (42%) and feeling mentally drained (40%)A third of workers experience stress or anxiety (32%), and one in four experienced interference with personal life/relationships (29%).One in five workers experience disrupted sleep (22%).
      • One in three workers (36%) indicate that unpaid overtime is either expected or encouraged in their workplace.
    •  The most common reason for working outside scheduled work hours is too much work (41%), with the second most common reason being staff shortages when other staff are absent or on leave (31%).

    Dissatisfaction with working hours
    Across the whole labour market, almost half of all employed workers (45%) are unsatisfied with their working hours – wanting either more or fewer hours.
    o One in three workers (32%) reported that they wanted more paid hours. This desire was especially strong among workers in casual jobs (51%). Over four in ten workers (43%) aged 18 to 30 years of age wanted more paid hours.
    o Just over half of workers (55%) indicated their hours were about right.

    To calculate how much pay you are losing through unpaid overtime go to our unpaid overtime calculator at gohomeontimeday.org.au



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  • No Blood – No Job

    Employment & Unemployment, Labour Standards & Workers’ Rights, Unions & Collective Bargaining

    No Blood – No Job

    Australia’s privacy laws and workers’ rights
    by Lisa Heap

    Author

    Lisa Heap

    Senior Researcher

    Organisations in Australia are using blood analysis as a means of screening future employees for ‘health risks’ that they allege may impact on their performance of work.

    Collecting sensitive information from blood analysis is restricted under Australia’s privacy laws. This is because the mishandling of this information can have a substantial detrimental impact on those who have provided the information. Requiring workers to submit to blood analysis is just one example of how organisations are now routinely collecting sensitive information from workers, sometimes without adhering to the requirements of privacy laws. Other examples include using fingerprint and facial recognition software and sensors that collect physiological and psychological data about workers.

    The protection from arbitrary interference with a person’s privacy is a fundamental human right. Interfering with this right, by collecting sensitive personal information, should occur in limited circumstances and only where necessary. However, this report shows that some organisations in Australia, are not treating the collection of sensitive information from workers as an exception. They are collecting sensitive information as a routine step in their employment processes.

    The findings of this report raise concerns about power, privacy, fairness, and the potential for discrimination in the practices being adopted by some organisations. These findings also show that Australia’s current privacy and workplace relations laws do not adequately address these concerns. Amendments to Australian privacy laws are currently being considered by the Australian Government with reforms likely to be put before the Australian Parliament before the end of 2024.

    This report examines the need for new provisions within either or both privacy or workplace relations laws that set out the rights of workers to protect their sensitive information. It argues that regulation should be geared towards, not only protecting workers’ rights to privacy, but to providing a disincentive to organisations hoarding and misuse of the personal and sensitive information of workers.

    The worker-centric approach called for in this report includes:

    • the development of one system of regulation to protect the privacy concerns of all workers regardless of employment status or work context
    • defining the collection of workers’ personal and sensitive information as high risk requiring both specific and detailed justification for the collection of this information and the genuine informed and affirmative consent of workers
    • the establishment of a tripartite mechanism to assist the regulator to develop and manage processes for dealing with the privacy and related human rights concerns of workers
    • the use of codes and frameworks, developed via a tripartite mechanism, to set out when and how workers’ information can be collected and used
    • the development of an easy to access, and timely, worker centered mechanism to address concerns about the collection and use of workers’ information.



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  • A Better Future for Self-Employment

    Gig Economy, Employment & Unemployment

    A Better Future for Self-Employment

    How is it changing, and how can ‘gig’ work be regulated?
    by David Peetz

    Author

    David Peetz

    Laurie Carmichael Distinguished Research Fellow

    Media release



    New Report Reveals Changing Face and Future of Self-Employment

    This report considers and challenges two common myths about self-employment.

    The first is that self-employment is inexorably growing. The second is that self-employment cannot, or should not, be regulated in order to protect self-employed workers and improve the conditions of their work.

    This new report from the Carmichael Centre at the Centre for Future Work shows that, in reality, self-employment is not growing inexorably — in fact, in most countries (including Australia) it is declining.

    The much-trumpeted surge in self-employment and ‘freelancing’ is a myth. However, the nature of self-employment is changing: fewer self-employed people are running successful independent businesses, and more are engaged in precarious ‘solo’ activities like short-term contracting and part-time ‘gig’ work.

    The report also shows that some forms of self-employment can be regulated to protect affected workers, provided two simple and important criteria are satisfied: the workers are vulnerable and hence need protection, and a viable mechanism exists that enables their work to be efficiently regulated.

    The report reviews the proposed provisions of the second part of the federal government’s new Closing Loopholes legislation, which would allow for minimum labour standards to be applied to digital platform workers and owner-operators in the transportation sector. The new legislation (to be considered in Parliament in 2024) is an appropriate and effective response to the challenges facing these two groups of ‘gig’ workers.

    Please see the full report, “A Better Future for Self-Employment: How is it changing, and how can ‘gig’ work be regulated?,” by David Peetz, Laurie Carmichael Distinguished Research Fellow at the Centre for Future Work.



    Full report




    Factsheet
    New Report Reveals Changing Face and Future of Self-Employment

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  • Inclusive and Sustainable Employment for Jobseekers Experiencing Disadvantage

    Employment & Unemployment, Insecure & Precarious Work, Public Sector, Procurement & Privatisation

    Inclusive and Sustainable Employment for Jobseekers Experiencing Disadvantage

    Workplace and Employment Barriers
    by Fiona Macdonald

    Author

    Fiona Macdonald

    Acting Director, Centre for Future Work

    This report provides an overview of workplace and job-related factors found to act as barriers to sustainable and inclusive employment for people in groups likely to experience labour market disadvantage. Key findings are that job quality, working arrangements, inclusivity and opportunity for participation at work all matter for inclusive and sustainable employment, along with individual and external systemic and structural barriers to work.

    Employment policy and employment assistance for jobseekers focus on individuals’ skills and job readiness, and on job placement. Less attention is given to ensuring placements are into sustainable employment in inclusive workplaces. That is, placement into jobs that people can keep, that support wellbeing and provide opportunity for long-term employment pathways, and in workplaces where people feel safe and are able to participate. Recruiting and placing people experiencing labour market disadvantage into jobs may not lead to positive outcomes if people are not able to retain jobs and benefit from their employment.

    Employment can provide people with benefits that improve wellbeing in various ways, including through increasing income, providing routine and increasing social contact. However, where job quality, pay or working conditions are poor, employment can also have cumulative negative effects. Placing people experiencing disadvantage in jobs in which they are insecure, underemployed, or cannot establish daily routines; or placing them in workplaces in which they experience poor or discriminatory treatment and disempowerment, are not likely to produce sustainable employment outcomes or create social value.

    This report calls for a greater focus on workplace and job-related factors, including employer knowledge, employment practices, work organisation, job quality and employment arrangements, to addressing barriers to employment for disadvantaged jobseekers. Emphasis on employment placement alone is not likely to produce sustainable employment outcomes. Action is required to tackle barriers present in workplaces and in employment arrangements.

    This report was commissioned by Jobsbank, a Victorian-based not-for-profit organisation that works with business and other partners to support sustainable, inclusive employment and make social procurement work. In Victoria, the Government’s Social Procurement Framework aims to improve employment outcomes for people from groups experiencing labour market disadvantage through requiring suppliers and contractors tendering for high value government contracts to employ people from these groups. The Victorian Government’s Fair Jobs Code promotes fair labour standards, secure employment and job security, equity and diversity, and cooperative workplace relationships and workers’ representation. This report recommends that employers be encouraged to develop strategies to meet these standards through collaboration with unions and community groups as one obvious way to address workplace and employment factors that create barriers to sustainable and inclusive employment for disadvantaged jobseekers.



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  • Tolerate Unemployment, but Blame the Unemployed

    Employment & Unemployment, Macroeconomics

    Tolerate Unemployment, but Blame the Unemployed

    The Contradictions of NAIRU Policy-Making in Australia
    by David Richardson

    Author

    David Richardson

    Senior Research Fellow

    Media release



    Chronic Unemployment a Consequence of Deliberate Economic Policies

    Selected media impact

    For the last generation macroeconomic policy in Australia has been based on the assumption that unemployment must be maintained at a certain minimum level in order to restrain wages and prevent an outbreak of accelerating inflation. Now, after six years of record-low wage growth – which weakened even further in the latest ABS wage statistics – it is time for that policy to be abandoned.

    In a comprehensive critique of unemployment and monetary policy in Australia, Senior Research Fellow David Richardson shows there is no stable statistical basis for the assumption that inflation will accelerate without end if unemployment falls below its so-called “natural” or “non-accelerating inflation rate” (NAIRU, commonly thought to be around 5%). And the economic and social costs of deliberately maintaining high unemployment are very large.

    Richardson’s paper, Tolerate Unemployment, but Blame the Unemployed: The Contradictions of NAIRU Policy-Making in Australia, has been published today by the Centre for Future Work. The study was reported in the Sydney Morning Herald and other papers.

    Among its major findings:

    • Officially recorded unemployment is only the tip of the iceberg of total underutilised labour in Australia. Counting underemployment, discouraged workers, and “marginally attached” workers, there are around 3 million Australians who would like to work (or would like more work) but can’t find it: far worse than the official unemployment estimate (currently around 700,000).
    • Recent disagreements between Treasury and the Reserve Bank of Australia over the precise level of the NAIRU (the former say it is 5%, the latter say it might be 4.5%) ignore the growing evidence that the core concept is invalid and unsupported by empirical evidence.
    • Numerical estimates of the NAIRU have been wildly inconsistent over time. This is partly because of a process called “hysteresis”: whereby the existence of even temporary or cyclical unemployment can create long-term barriers to employment that seem to inhibit subsequent job-creation. If policy-makers believe in an elevated NAIRU, and act to ensure that unemployment stays at or above that level, then it becomes a self-fulfilling prophecy – and economic performance is undermined for decades.
    • Monetary and fiscal policy should be shifted to aim to steadily reduce unemployment as low as, rather than targeting a certain minimum assumed NAIRU.
    • The economic benefits of reducing unemployment are enormous. Every one-percentage point reduction in unemployment results in 134,000 new jobs, $10 billion in additional output, and billions of dollars in additional fiscal revenue for governments.
    • There is an enormous contradiction between a macroeconomic policy that deliberately maintains unemployment, and a social policy that blames the failures of unemployed people (such as a supposed lack of “work ethic”) for their own hardship.
    • The long-term freeze in Newstart benefits (which have not changed in real terms since 199) should be abandoned, and benefit levels increased substantially. Since chronic unemployment is the outcome of deliberate policy, the least society can do is fairly compensate those who have been hurt by this policy.

    Australia’s continuing record-low wage growth, and sluggish economic performance, make the need for a change in policy direction all the more urgent. Even within the constraints of the NAIRU policy, the RBA and the government have failed to meet their own stated objectives: for example, inflation has languished well below the official 2.5% target for over 5 consecutive years. It is time for a fundamental rethink of macroeconomic policy, which should be focused on restoring genuine full employment as the top priority.



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  • Unemployment and the Newstart Allowance

    Employment & Unemployment

    Unemployment and the Newstart Allowance

    by Raja Junankar

    Author

    Raja Junankar

    Australia’s Newstart benefit hasn’t been increased in real terms in a generation, and pressure is growing on the Commonwealth government to address this inequity and raise the rate. Even RBA Governor Philip Lowe has indicated that better Newstart benefits would stimulate consumer spending and support the economy.

    But the government continues to reject the idea, and instead has fostered lamentable and divisive rhetoric about “dole bludgers” and the supposed lack of “aspiration” among unemployed Australians. Old stereotypes about unemployed people choosing to subsist on poverty-level benefits, instead of looking for work, have been invoked.

    In this paper, Prof. Raja Junankar of UNSW University shows that keeping the Newstart Allowance constant in real terms at a poverty level does not help the unemployed find jobs more rapidly. Despite rock-bottom benefits that have declined notably relative to average wages, long-term unemployment has increased – including among vulnerable groups of workers (like younger and older workers).

    The solution to unemployment is more jobs, not inadequate income benefits.



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