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Surgery with a sledgehammer

Why we need a different approach to non-standard work

· Sam Perkins,Employment

Competing narratives about the nature of insecure work in Australia fail to appreciate the level of diversity in non-standard work. Current popular solutions often rely on incorrect or incomplete assumptions about the characteristics of the labour market at the macroeconomic level. Such an approach creates risk for addressing the very real issues facing workers in the new economy and may ultimately leave workers worse off.

While there is no doubt there are negative dynamics facing a cohort of the workforce that is seeking more hours, permanency or other indicators of certainty around employment and income, the challenge has been to sort the reality from the rhetoric.

In the opening months of 2018, an increasing amount of media and political attention has been directed at so called “insecure” employment, or work which is characterised by poor wages and hours, uncertainty regarding shift schedules, and a lack of employment rights or ongoing opportunities. This is otherwise called “flexible work” by proponents, many of whom claim that the concept of “insecure work” is indistinguishable from a campaign slogan and shouldn’t be a driving concern in industrial relations policy. This presents policymakers with a false dichotomy. Advocacy groups of all kinds paint a picture where we either have a two-track economy with happy secure workers and unhappy insecure workers, or we live in a paradise of flexible arrangements where anyone can get the kind of work that they want and need.

The true picture of employment has been explored a number of times over the past two decades through a number of rigorous statistical studies. The Household Income and Labour Dynamics in Australia (HILDA) survey in particular gives us long-running, multidimensional data that we can use to track the progress of different cohorts over the course of their careers (or at least since the start of the millennium). Combined with other kinds of statistics from the ABS, these studies shine a light on many of the more obscure elements of non-standard work. The academic literature consistently highlights the negative effects that long term insecure work can have on workers, but likewise, it highlights the huge number of workers on short term and irregular work who derive a significant net benefit from it. The data tells us that a third of casual workers are studying full time, dismissal rates are about half what they were in the 1970s and there has been no recent increase in the number of Australians working second jobs or as “self-employed” workers. This is in a time when workforce participation has changed profoundly, with huge numbers of women entering the workforce and older Australians moving in and out of the workforce as suits their needs. Unemployment remains relatively low, although more recently there has been a higher than historical level of underemployment; this is a related problem in terms of impact on workers but it is qualitatively different set of issues and the two should not be conflated.

While there are slices of data that various partisan claims are true for, political commentary remains riddled with false attributions, inappropriately aggregated data and unintentionally misleading indicators where complex and diverse datasets are massaged without due caution. The existing political stances that some commentators bring to the issue can explain some of this. However, the fact that so many commentators can use technically correct data while painting a fundamentally contradictory image of the workforce shows the dangers of selection bias. The result is wasted effort fighting unwinnable battles; a partisan trench warfare in which neither side can conclusively win any ground.

Ultimately, we at FPL are seeking to understand which cohort of the workforce is most at risk (in their terms) of insecure work, is seeking change and would likely benefit most from a practical solution to their employment dynamic. FPL explores these issues and more in an upcoming Occasional Paper on casualisation and non-standard work, seeking to bring political and academic understanding of the new workforce into closer alignment. We work across partisan and sectoral lines in pursuit of pragmatic outcomes, and in producing this Paper we aim to contribute to policymaking that is practical, fair and satisfactory to all stakeholders.

Sam Perkins is a Policy Analyst at FPL Advisory, writing on political risk and change management in regulatory affairs

FPL Advisory provides support to government, not-for-profit and corporate clients across a range of policy and regulatory reform issues

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