Tag: Dan Nahum

  • 2020 Year-End Labour Market Review: Insecure Work and the Covid-19 Pandemic

    2020 Year-End Labour Market Review: Insecure Work and the Covid-19 Pandemic

    by Dan Nahum and Jim Stanford

    Australia’s labour market experienced unprecedented volatility during 2020 due to the Covid-19 pandemic and resulting recession. In the first part of the year, employment declined faster and more deeply than in any previous economic downturn, as workplaces were closed to control the spread of infection. Then, after May, employment rebounded strongly. The subsequent recovery has replaced over 80% of the jobs lost in the initial downturn. While considerable ground remains to be covered to complete the employment recovery, the turn-around in the quantity of work has been encouraging.

    However, the pandemic also highlighted stark fissures in Australia’s labour market. The employment and income impacts of the pandemic were starkly unequal, across different groups of workers. This report highlights several ways in which the pandemic has increased inequality in Australia, and reinforced the dominance of insecure work in the overall labour market.



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  • Work and Life in a Pandemic

    Work and Life in a Pandemic

    An Update on Hours of Work and Unpaid Overtime Under COVID-19
    by Dan Nahum

    2020 marks the twelfth annual Go Home on Time Day, an initiative of the Centre for Future Work at the Australia Institute that shines a spotlight on overwork among Australians, including excessive overtime that is often unpaid.

    It has been an extraordinary and difficult year, to say the least. Many workers are doing at least some of their work from home, and the standard scenario of ‘staying late at the office’ around which we have often shaped our Go Home On Time Day analysis in the past applies to fewer workers than usual. But that is not to say that workers aren’t doing work for free—in fact, the estimated incidence of ‘time theft’, or unpaid overtime, has gone up compared with 2019 (see our results here). And in many cases people’s responsibilities in their home lives have increased in response to the health and social crisis, accentuating the double burden faced by workers—and especially by women workers.

    Survey data suggests the average Australian worker puts in 5.3 hours per week of unpaid overtime, despite the shift towards home work. Many employers expect this free labour as a sign of workers’ “dedication”, but it’s unfair and in many cases illegal. Across the whole labour market, this theft of workers’ time now amounts to almost three billion hours, or $100 billion, per year. In an environment of depressed household demand and purchasing power, this has extraordinarily damaging consequences throughout the economy—including throughout the business sector.

    Additionally, 70% of people working at home are doing some of it outside of normal working hours. The post-COVID rise in home work may constitute a further incursion of work into people’s personal time, and a further undercutting of Australia’s minimum standards around employment (including hours, overtime, and penalty rates).



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  • The Choices We Make

    The Choices We Make

    The Economic Future of Tasmania
    by Dan Nahum

    New research by the Australia Institute’s Centre for Future Work analyses the economic effects of COVID-19 on Tasmania, and suggests how Tasmania can ‘build back better’ out of the COVID-19 crisis, making key recommendations to help Tasmania avoid the mistakes made at the Federal level. Ahead of Tasmania’s State Budget, set to be delivered on 12 November 2020, in this new report the Centre for Future Work has explored what the shape of Tasmania’s economy could look like, and how it can recover and reconstruct after this pandemic.

    Businesses and households will not simply ‘regain confidence’ and drive a full recovery themselves. Indeed, Tasmania’s proactive and protective fiscal response indicates that the state government already understands that major support from government is necessary. As a proportion of the state’s gross state product, Tasmania has committed the largest amount of funding of any state. Meanwhile, extremely low borrowing costs mean that there is no reason for the state government not to undertake a more proactive role in the economy than it has done historically, even if that means higher deficits.

    However, a short-term, counter-cyclic approach does not adequately respond to the full scope of the challenge. The underlying working machinery of the economy is not in good order. COVID-19 has highlighted existing vulnerabilities and created new ones, and it has also limited the scope of the private sector to respond.

    The state government in Tasmania will clearly be required to play a hands-on, leading role in job creation, investment and income generation for years to come, and it will need to borrow to do so. This fact should not be feared, but celebrated: large deficits are the flipside of the public investment that will be required to undertake Tasmania’s reconstruction. It will be necessary to mobilise economic resources, to meet human needs and to get Tasmanians working again—especially if the intention is to build a more resilient and diverse economy than the one that existed before COVID-19.

    The Tasmanian economy will not have the same shape as it did before the pandemic. Tasmania can and must think differently about what is possible. Our purpose in this research paper is to add momentum to Tasmania’s conversation about its economic, and social, future. As a result of COVID-19, Tasmania could push itself forward into the next stage of its economic development, or it could, alternatively, spiral into a depression, scarring lives and communities. It cannot afford that. Tasmanians, moreover, deserve far better.

    The report recommends:

    • the Tasmanian Government make a larger investment in public housing
    • the State Government also expand public sector investment into the health, aged and disability care sectors
    • outsourced public sector functions should be returned to direct provision by Government wherever possible, to improve cost, accountability and quality
      • doing so will also provide the State Government with a lever to improve wages and conditions across the economy, especially in sectors dominated by women
    • the Tasmanian Government should also support and co-invest in several strategic industries, including manufacturing and renewable manufacturing, tourism and hospitality, arts and entertainment, food production, and higher education.



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  • Public Service in Challenging Times

    Public Service in Challenging Times

    The Economic and Social Value of Public Sector Work in Queensland
    by Dan Nahum

    In times of crisis, governments have a responsibility to their citizens to maintain and expand their role in the economy – for both economic and social reasons. This responsibility has never been clearer than during the current COVID-19 pandemic, and its associated economic downturn. Australians are counting on their governments to protect them from the pandemic, support them through the resulting recession, and play a leading role in rebuilding a stronger, healthy society in the aftermath of this unprecedented catastrophe.

    Moreover, the economic benefits of providing those essential services spread throughout the state economy, supporting jobs and incomes including in the private sector.

    In the context of the upcoming Queensland election, research from the Centre for Future Work shows that in addition to some 331,000 direct jobs providing broader state-funded public services, 150,000 private sector positions depend on the economic stimulus provided by public sector work. In total, some 480,000 positions are supported, directly and indirectly, thanks to the provision of state-funded public services in Queensland. In particular, regional and remote Queensland depends on the public sector as a crucial source of decent, socially valuable jobs, performed by well-qualified people, earning (and spending) middle-class incomes in their regional communities.

    Cutting public sector jobs and wages not only directly affects their own economic fortunes, but also negatively impacts the broader economy through spillover reductions in demand, spending, and production. To dramatise these broader economic consequences, this report describes simulations of two possible three-year austerity scenarios:

    • A one-year ‘freeze’ in aggregate public sector payrolls (considering both wages and staff levels).
    • A one-year 5% ‘cut’ in aggregate public sector payrolls (effected through some combination of wage and staff cuts).

    Over three years, the ‘freeze’ scenario reduces total GDP by a cumulative total of over $9 billion: including the loss of incomes for state public servants, and the resulting loss of income and output in the whole range of consumer goods and services industries which depend on the consumer spending of public sector workers. This decline in GDP translates into the loss of 20,000 person-years of employment in the private sector industries which are hurt by the freeze. Over a similar three-year period, the ‘cut’ scenario would reduce cumulative GDP by $15 billion, and eliminate some 35,500 person-years of employment in private-sector goods and services industries.

    In this unprecedented moment, the maintenance of public services (and supporting the jobs that depend directly and indirectly on those services) is surely a more urgent priority than cutting government spending in pursuit of some illusory fiscal target.



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  • Technology, Standards and Democracy

    Technology, Standards and Democracy

    Submission to Select Committee on the Impact of Technological Change on the Future of Work and Workers in New South Wales
    by Dan Nahum and Jim Stanford

    Workers in most industries and occupations worry about the effects of accelerating technological change on their employment security and prospects. New digital technologies are being applied to an increasingly diverse and complex array of tasks and jobs – including artificial intelligence and machine learning technologies which can exercise judgment and decision-making powers. Some studies suggest that as many as half of all jobs may be highly vulnerable to automation and computerisation in coming decades. The NSW Legislative Council has established a Select Committee to examine the impact of technological and other change on the future of work in NSW. The Centre for Future Work has lodged a submission.

    Concerns about technological unemployment are not new. Workers have long worried what will happen to their jobs when machines can do the work faster, cheaper, or better. But the historical record shows that technology has not produced mass unemployment or impoverishment – although dislocation and adjustment to technological change can be severe for some groups of workers, and some regions. The impacts of technology are always filtered through social and political processes; competing sectors of society naturally endeavour to protect and advance their own respective interests, as technology evolves. Will technology be used to enhance mass living standards and make work more efficient and pleasant? Or will it be used to enrich a small elite, while undermining the economic well-being and political rights of the majority? The answer depends on how technology is implemented, managed, and controlled, and whose interests prevail as the process unfolds.

    Employers tend to implement particular kinds of technology, in specific ways, to enhance their power and profits: not just to boost output, but also to intensify work effort, monitor and discipline workers, and restructure the terms of employment. These negative trends are not inherent outcomes of technology itself. Rather, they are the result of power imbalances in employment relationships, in the context of an economy that is shaped and directed by the profit-maximising actions of private firms.

    In our submission, we discuss several reasons why the impact of technology on both the quantity and quality of future employment is indeterminate, and highly dependent on the policy choices that are made as the process of labour market evolution unfolds.  While some workers will face heightened risk of job loss due to new technology, we nevertheless firmly reject the notion that work in general can somehow ‘disappear’ – even in sectors which seem ripe for the application of labour-saving or labour-replacing technologies. And we reject the implication that workers will somehow be ‘disposable’ in a brave new automated world. The reality is that productive human labour, broadly defined, is still the driving force behind all production and value-add. This is true even in an economy utilising automation and other technology-intensive methods of production. We must be aware of the risks and challenges posed to workers by accelerating technological change, but without resigning ourselves to a dystopic high-tech future in which workers have no power, no agency, and no security. Instead, our response to the challenges posed by technology can be grounded in a complete and balanced assessment of the threats and opportunities associated with new technology.

    The submission is organised as follows:

    • ‘Technology and Work: What changes are at play?’ identifies changes – and continuities – in the world of work in which technology plays a role.
      • This includes a subsection, ‘Electronic Surveillance in the Workplace’ on the incidence of this type of surveillance by employers in – and beyond – the workplace, using results from the Centre for Future Work’s 2018 survey on the incidence and impacts of such surveillance.
    • ‘The Macroeconomic and Social Context for Technological Change’ considers the broader political-economic factors contributing to how we use and regard technology in the workplace. Many of the changes often ascribed to technology are better identified as social or political matters, mediated through or exacerbated by technology.
    • ‘Technology and the Quantity of Work’ discusses technology’s impacts on the quantity of work available. We note that the uptake of technology by employers is in fact surprisingly lower than what many analysts have predicted – further evidence that technology’s effects on the work of work are mediated by social and political factors.
    • ‘The Technology of Production and the Organisation of Work’ further teases apart the distinction between technology as a discrete set of tools, and the social organisation of work, such as precarious employment. There is an interaction and overlap between the two but consideration of the set of challenges under this Select Committee’s Terms of Reference is lent more rigour by identifying the distinctions, too.
    • We present recommendations seeking to support the goal of maximising the benefits of technology, while reducing and ameliorating its social costs.
    • The submission concludes by reiterating that it is not technology specifically, but rather our systems of laws, institutions and social expectations overall that will determine the future of work.

    We are hopeful that this Select Committee can contribute to developing a strategic understanding of, and leading legal framework for, changes in the nature of work and the labour market. These issues have increased in importance in the context of the economic crisis, and the resulting weakness in the labour market, associated with the COVID-19 pandemic.



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  • Powering Onwards

    Powering Onwards

    Australia’s Opportunity to Reinvigorate Manufacturing through Renewable Energy
    by Dan Nahum

    With disruptions in international supply chains for essential products (like medical equipment and supplies) disrupted in the current COVID pandemic, Australians have a new appreciation for the importance of retaining a flexible, high-quality, domestic manufacturing capacity. And the ongoing transformation of Australia’s energy industry, with rapid expansion of renewable energy sources, would add momentum to the renaissance of Australian manufacturing.

    That is the conclusion of a new study written by Dan Nahum, Economist at the Centre for Future Work.

    The report notes that power from renewable energy sources (both solar and wind) are now substantially less expensive than fossil fuel generation on a full lifecycle cost basis – and moreover, that cost advantage will grow in coming years. The report simulates the annual power cost savings to manufacturers if the sector’s current use of fossil fuel-fired power was fully transferred to renewables (as existing generating facilities are retired and replaced). The sector’s power bill would decline by an estimated $1.6 billion per year, or 23%, compared to the current fuel mix. The saving swells to $2.2 billion (in constant dollars) by 2050.

    The paper also provides numerous examples of manufacturing industries which are already making use of renewable power to capture cost and reliability advantages, as well as various manufacturing industries which hold great potential to supply Australian-made manufactured inputs to renewable power systems (from lithium-ion batteries and electric vehicles, to public transportation rolling stock, to green hydrogen). The paper reports international evidence showing that companies which have reduced greenhouse gas emissions more successfully have attained greater success in manufacturing output and exports than Australia.

    The paper also shows there is a strong majority overlap between Australians regarding the manufacturing sector as important, and those in favour of expanding the use of renewables, making this a viable dual public policy goal for governments.



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