Flexible measures for a flexible labour market
Abstract
"The system of labour market statistics in Australia is in need of reform. The principal
measure of labour market performance, the unemployment rate, was developed in an
era when the labour market was characterized by full-time male bread-winners. Over
the last two decades, deregulation and structural change have transformed the labour
market radically. Underemployment of part-time and casual workers is now a serious
problem, as is the issue of overwork. Yet a proper understanding of these important
trends is missing from public debate and policy-making because they are not captured
in the official statistics.
A single summary indicator cannot capture all of the dimensions of labour market.
Rather than continue to attempt to place all Australians into one of three labour force
categories and describe the performance of the labour market by dividing one category
by another, this paper advocates a different approach. This would incorporate
information on how many hours people would prefer to work as well as how many
hours they do work. By asking respondents to the ABS’s Labour Force Survey to state
both the number of hours they worked and the number of hours they desired to work it
is possible to measure the nature and extent of unemployment, underemployment and
overwork simultaneously, and to do so much more accurately than is currently the
case."