Australia is still nowhere near solving the problem of unemployment

By Joe Montero

The white paper on unemployment called working Future and presented in parliament last week, revealed quite a bit that is important, while at the same time providing no recommendations on how to lower Australia’s real current level of unemployment. It supports the business-as-usual approach.

Within its 264 pages the paper admits that the current way of determining the level of unemployment understates the reality and that it would be better that this change. Many have been saying this fir years.

A polite way of saying unemployment is to use the term under-utilisation of the labour market. This is being used to obfuscate and ignore the whole picture.

Understatement was entrenched like never before under John Howard and has remained the same way ever since. The truth is that governments have had more to hide from the public. Telling the truth about jobs and unemployment would not make them popular, and this is bad for lection prospects. And parties have swallowed the American originated economic doctrine off neoliberalism.

A proper way to measure how many are out of work is to include those who are officially seeking a job and have none, those who want a job but might be doing something else because they haven/t found one yet, and especially today, those who have been forced into substandard and art-time work, because that is all that is available to them. All of these come under the category of involuntary unemployment.

Voluntary unemployment is a term used nowadays as a label, to discount all outside the official definition. Those who choose not to work as a lifestyle decision are very few and insignificant in statistical terms. But this hasn’t stopped governments from using the term to vilify the unemployed and cover up their inadequate policies and statistics.

This brings up an important point. The proper definition of being employed should include having a job that pays enough to maintain an acceptable standard of living. Another important point is that to be anyway near full employment, somebody looking for work must be able to choose between different available jobs and not settle for whatever comes along. This means there is no choice and a high risk of substandard work.

These qualifications are not new. They were accepted in Australia before the Howard era. The White Paper traces back 80 years till 1945, when the last similar White Paper was tabled in the parliament. What the government said then was far more honest than has been the case in more recent times.

Photo from the Orange and District Historical Society: There was more honesty about jobs and unemployment back in 1945

Photo from the Orange and District Historical Society: There was more honesty about jobs and unemployment back in 11945

The White Paper admits much of what is said here, and that 2.8 million Australians are out of work. This is equivalent to 20 percent of the workforce. Admitting this and some other relevant facts is the positive part. The negative is that it doesn’t even hint at a way out through policy recommendations. This wasn’t its brief. There is acceptance of the bipartisan approach of minimal government involvement and reliance on the market mechanism.

Reliance on the market mechanism means acceptance of the restructuring of the labour force in conditions where major employers demand the flexibility to add a tier of lower paid workers, unprotected and suffering fewer protections at work. This describes today’s Australia. The proportion now included in this second tier of the labour market is now approaching 40 percent of the total.

Pushing this is the ability to use the less fortunate to pull down the wages and conditions of all. This is the reason why the wages share of national income has fallen in real terms and remained stagnant in the official statistics.

The video below represents a worldwide union campaign to eliminate precarious work and provides a basic explanation of what is going on.

STOP Precarious Work

Video from IndustriALL_GU of this would have been possible without there being a shortage of enough jobs to meet the demand for them. In other words, real unemployment had to be sufficiently high.

It’s true that the present Albanese government has made some moves to stop the worst offenses that might be committed by employers. This deserves support. But it is still a long way from rejection of the restructuring that’s been taking place, and this restructuring is the result of the distorted market mechanism under a high degree of market concentration, and the power of monopolies operating in more challenging economic conditions.

An alternative is possible. This starts with admitting the real nature of the labour market and unemployment. It continues with sound and clear policies that consciously set the goals to providing everyone with a job and ensuring that all jobs are up to standard. This will involve considerable government investment. Doing this would meet a further goal of providing massive stimulus to the economy.

The solution can’t be left in the hands of the market and the monopolies. They have already failed to achieve these goals.

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