What’s a Million, Anyway?
Authors
Media release
In the lead-up to the 2013 federal election, then-Opposition Leader Tony Abbott made a high-profile pledge that a Coalition government, if elected, would create 1 million new jobs over the next five years. Abbott was elected (although later ousted by his own party), and total employment in Australia did indeed grow by over 1 million positions between 2013 and 2018. Current Prime Minister Scott Morrison hopes that this success can resuscitate his party’s flagging fortunes: he has pledged, if elected, to create even more jobs (1.25 million) over the next five years.
But a new report from the Centre for Future Work takes a closer look at the government’s claims, and finds that Australia’s job-creation record since 2013 has actually been unimpressive.
Australia’s working age population is over 20 million, and growing rapidly. The labour market must create well over 1 million new jobs every five years, just to keep up with population growth. Moreover, it was only due to a surge in part-time jobs (most of them casual, low-wage positions) that Mr. Abbott’s million-job target was met. If full-time work had retained its previous share of all work, the number of new jobs would have fallen well below the 1 million benchmark.
The Centre for Future Work has prepared a comprehensive review of Australia’s labour market performance since 2013, on the basis of year-end employment data for 2018 just released by the Australian Bureau of Statistics.
The report is based on a detailed analysis of official labour market statistics, going back as far as 1958. Major findings include:
- 2013-18 was the tenth time Australia created at least 1 million jobs in 5 years. The first time was 30 years ago.
- But Australia’s population is much larger now, so 1 million jobs is no longer such an “achievement.” The rate of employment growth since 2013 has been slower than the long-term historical average.
- Part-time jobs accounted for almost half of all jobs created since 2013. Most of them are casual jobs, and average wages are much lower.
- Hours of employment grew more slowly since 2013 than Australia’s population. That means the amount of work available, on average, to each potential worker declined compared to the previous 5 year-period.
- Because new work was not keeping up with population growth, total underutilisation of workers (including unemployment, underemployment, and discouraged non-participation) got worse over the last 5 years.
- In addition to an inadequate quantity of work, the quality of work has also deteriorated by several measures: including more casual jobs, precarious self-employment, and reduced coverage by collective agreements.
- Since 2013, wage growth has slowed to the slowest sustained rate since the 1930s. And since nominal wages are not keeping up with inflation, real wages have declined.
In this broader statistical perspective, Australia’s recent labour market performance has not been stellar. It’s been mediocre, at best. That explains the growing anger expressed by millions of Australians concerned about stagnant wages, insecure work, and falling living standards.