"Employment is the means of earning a living having an identity, acquiring social staus in society and participating in social activities. Employment constitutes the fundamental prerequisite for the rights of social citizenship. An unemployed person is condemned to an inferior status and is deprived of access to resources."
Policy Objectives of Employment Policy include:
- Increasing human capital.
- Social protection for individuals and groups.
- Main focus: Level of employment, workforce skills availability of trained workers to meet industry demand and unemployed people who want to work can get a job.
An unemployment graph can be found at tradingeconomics.com.
What's the problem?
If unemployment is actually low compared to most of the world allot of people are saying, what's the problem?
"If the big problem since the early seventies has been finding jobs for people, the big problem with the new decade will be finding people for jobs." ~ Edwards 2004.
Unemployment in Australia is lower than most comparable countries.
"Highest unemployment represents the largest single policy failure of the last quarter century." Stephen Bell, 2004
What's the Problem??? Social cost is 5.8% = 712,400 people or 16.6% are youth (age 15-19), indigenous 16% (2011) and various regional differences. Economic and fiscal cost is unemployment benefits 2013-14 = $9.5 billion. Labour market programs cost $2 billion.
The Australian 2013-14 Budget includes more assistance for other groups within the community such as the aged, families, veterans and those with disabilities.
Further... What's the Problem??? At one level unemployment tracks lots of things such as those that have the Dole bludger syndrome (those that could get employment but take advantage of not needing to work by staying on welfare payments). The workforce has changed over the last 50 years - Incresaed employment of women has led to gender segregation of industry and occupation. There has been a decline in manufacturing employment and an increase in services employment.
The Workforce change... There has been an increase in part-time and casual jobs. Long hours of work for full-time employees - high levels of under employment for others. There's been a decline in full-time jobs with 'standard' hours. Increasing "own account" workers and independent contractors. Growing inequalities in income and work conditions.
Policy Components for Employment Policies - Market direction is relied upon for economic growth and labour price flexibility to better match the demand and supply. Government intervention includes industry policy, labour market programs: demand for labour and supply of labour. (workers)
Generally both parties have utilised both approaches by moving in the market direction. The coalition likely to favour the market (liberals) while labor are more sympathetic to intervention.
Labour - Priority on skills education and training, connnection between labour force, productivity and social inclusion.
Coalition - Demand for labour = overall economic growth.
Economic Growth - The rate of growth shapes the level of employment. Australian economy needs to grow by 3% if unemployment is to remain stable. GDP forecast: 2013-14 = 2.5% and 2014-15 = 3%. The unemployment forecast is 6.25% on average, June 2014.
Wages - Neo-liberal argument is unemployment caused by lack of labour market flexibility. Lower wages = more employment, Wage increases = more unemployment. But too hard to lower wages - Employers will reduce labour costs by downsizing, casual or outsourced employment, which results in work intensification. Wage-fixing institutions and trade unions prevent a free market - attempts to minimise the role of arbitration and unions.
The Counter argument is no clear correlation between the level of wages and the level of unemployment. Some countries have higher wages than Australia and lower levels of unemployment. Some countries have lower wages than Australia but higher overall unemployment.
Intervention - Industry Policy - Government support needed to boost investment and jobs in target industries.
"If they really wnat ot bring an end to unemployment, governments will have to undertake more public investment and intervene direction to supply jobs."
Labor government (2012) - Some fiscal stimulus went to industry to keep Ford and General Motors in Australia. Assistance to vehicle manufacturing is 'for the good of the economy and the nation.'
Intervention - Labour market programs - Macro/general level is education and training systems & policy push for education to provide employment skills. Child care and parental leave. Micro/individual level is the active labour market programs such as employment services and individualised training.
Election 2013 Labor Launch focused on jobs and training with a 'rapid response' to newly unemployed. Federal construction projects to employ minimum numbers of apprenticies and trainees. Commitment to future of TAFE funding and federal takeover if states don't maintain funding. Jobs and Training boards in 42 regions.
While the Coalition promised one million new jobs over the next five years (1.7% a year) and two million new jobs over the next decade (1.6% increase per year).
"Create Jobs by Boosting Productivity" - Download the Policy
"Unemployment can have a corrosive impact on individuals, families and society at large. In addition to the economic costs, unemployment can be particularly debilitating particularly if for long periods of time. Allowing people who could readily work to stay out of the workforce for long periods is cruelty, not compassion."
Both parties committed to indigenous employment plans, neither party committed to increase the newstart allowance however they both were concerned about international education.
Measuring Unemployment
Concepts include labour force, employed, unemployed, long-term unemployed, very long-term unemployed, participation rate, youth unemployment, part-time work, casual employment, underemployment & underutilisation, hidden unemployment.
Unemployment is measured independently of looking at hte Australian Government social welfare system and is measured by the ABS.
Households selected for the labour force survey are from a selection of 26,000 household, c. 60,0000 people.
Concepts - Employed worked for a least one hour a week or normally worked but on leave etc. Unemployed meant you didn't work for more than an hour and are actively looked for work in the preceding 4 weeks and were available to start work. Unemployment rate is the % of labour force which is employed.
ABS labour force survey, August 2013 - The Labour Force = 12,360,700 people 54 % males and femals are 46%. The tred over the last 4-5 years has steadily declined since June 2009 but crept back up in 2011 to it's current position, just below 6%.
Long-term unemployed is (0ver 52 weeks). In the 1970s this was around 5% while in 1989 it was around 22% today in August 2012 it was 18.7% and in August 2013 it was 19.6%.
Very Long-term unemployed - over 104 weeks is 9.5%.
Youth unemployment (15-19) is another category - August 2010 (17.3%) and in August 2013 (16.4%) (132,600). Unemployed youth that are looking for full-time work is 26.4%.
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