News Insight

A future that works

Building a better future for work in Victoria by 2030 requires an ambitious, two-pronged effort to address both dimensions of the current labour market crisis- quantity and quality, JIM STANFORD says.

“Work.” It seems like a four-letter word on Monday mornings, as we drag ourselves out of bed and off to our jobs. Yet it’s a necessity of life – for the simple reason that most of us have to work, just to support ourselves.

But the world of work is under pressure. Jobs are harder to find, and harder to keep. The traditional security of a permanent job – with regular hours, living wages, and basic entitlements – has become a rarity. In fact, less than half of employed Australians now work in a traditional ‘standard’ job – full-time, permanent, paid employment with regular entitlements (like paid holidays and sick leave). Most jobs now encompass one or more dimensions of insecure or precarious work – including part-time, casual, labour hire, temporary, contractor or self-employed positions.

Australia’s labour market faces a dual crisis of both quantity and quality.

In quantity terms, there isn’t enough paid work for those who need it. Demand for labour has been inadequate relative to Australia’s working age population since the global financial crisis. The official unemployment rate (currently around 5.5 per cent) does not begin to capture the full extent of labour market slack.

In quantity terms, there isn’t enough paid work for those who need it. Demand for labour has been inadequate relative to Australia’s working age population since the global financial crisis.

After all, to be officially classified as unemployed, someone cannot have worked a single hour in the week they were surveyed, and must have submitted several active job applications (thus demonstrating the “sincerity” of their job search).

This excludes more than 1.1 million underemployed Australians (who work some hours, but want and need more), as well as those who have given up looking for work, and those classified as “marginally attached” (even though they want to work). All told, true underutilisation in Australia’s labour market is at least three times higher than the official unemployment rate

In quality terms, the erosion of standard permanent jobs further undermines the level and stability of workers’ incomes. Not knowing when they will work, nor how much they will earn, makes it impossible for participants in this “just-in-time” workforce to plan or balance their lives.

The erosion of traditional labour market regulations and standards (including minimum wages, the awards system and collective bargaining) have further tipped the scales in favour of employers – who are only too willing to reorganise their business models around the permanent existence of this pool of desperate, “flexible” workers.

Work will continue to be the fundamental driving force of economic progress in our economy. There is nothing else but productive human labour, both physical and mental, that can add value to the resources we harvest (hopefully sustainably) from nature, and produce the full range of goods and services (including human and caring services) that are essential to our standard of living. Demanding the right to work, in decent, secure, fairly-compensated jobs that allow workers to balance work with the other facets of their lives, must be the centerpiece of any comprehensive vision of progressive reform for Australia.

To be sure, new vistas in automation will eliminate many existing jobs – but at the same time, other jobs will be created, including doing new tasks we haven’t thought of before.

Left to its own devices, there’s no guarantee the labour market will produce enough new work, nor that it will be decent work. I am actually more concerned about the negative impact of technology on the quality of jobs, than on the quantity. But there will certainly be work.

To build a better future for work will require an ambitious, twopronged effort to address both dimensions of the current crisis – quantity and quality.

We need a lot more work – creating jobs should be the first priority of government macroeconomic policy (in place of the inconsistent austerity approaches of recent years). This includes creating jobs in human and public services, through sustained investment in infrastructure, and with active strategies to nurture high-quality, innovation-intensive value-added sectors (instead of relying disproportionately on resource extraction).

We also need to lift the quality of jobs, and this means rebuilding the tools and instruments that empower workers to win a better deal from their employers. Rebuilding Australia’s discredited vocational training system, providing marginalised communities with meaningful opportunities and developing more effective labour market information and planning mechanisms, will also help ensure all Australians have a meaningful chance to work to their fullest potential.

Putting Australians back to work in decent, fairly compensated jobs, is crucial for addressing the biggest economic and social problems we confront – whether it’s strengthening household finances, reducing social exclusion or even repairing government budgets.

Ultimately, there’s no shortage of work to do – including the work of caring for each other, our communities and the planet. The real challenge is whether we can organise our economy to make the most of our collective capacity to work, in decent, sustainable, humane jobs. If we can do that, then work might just stop being a “four-letter word”.

Jim Stanford is Director of the Centre for Future Work at the Australia Institute