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Employment Polarisation in Australia

Author

Listed:
  • Peter Dawkins

    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

  • Paul Gregg

    (University of Bristol, H.M. Treasury and Centre for Economic Performance London School of Economics)

  • Rosanna Scutella

    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne)

Abstract

Whilst employment levels in Australia are healthy when compared to those twenty years ago, the available work has become increasingly polarised into either all-work or no-work households. This paper measures the extent of polarisation that has taken place in Australia between 1982 and 1997/98 with a measure of polarisation that accounts for changes in individual based employment. Initially we measure the extent of polarisation against a benchmark of randomly distributed work and then extend this to account for varying employment rates across subgroups of the population. We find that employment growth over the period should have largely offset the effects of shifts in household composition towards more single-adult households. However, polarisation of employment across households means that there are around 3.3 percentage points more households with no earned income. The vast majority of the increase in polarisation is found to be within-household types and does not reflect shifts to household types where employment levels are traditionally low. We also find that couple households with children are the dominant household type to see rising joblessness as a result of this polarisation. Exploration of whether wider shifts in employment away from less-educated men and toward prime-age better educated women lie behind these developments suggest that about 40% of the adverse shift against couples with children and against this benchmark lone parents do much worse. Lone parents have gained employment over this period at a faster rate than the average worker but are failing to keep up with prime age women who contribute to the growing number of couples where both adult work. Households renting privately are also particularly prone to the growing polarisation of work even after conditioning on varying employment prospects. The increase in all-work households is confined to multi-adult households, again focused on families with children. Hence, there is a large shift in patterns of employment in households with children, away from a dominant single male earner model toward more dual-earner and no-earner (couple and single) households with children. This dramatic polarisation of work and incomes for families with children is likely to have consequences for welfare costs and child opportunities in the next generation.

Suggested Citation

  • Peter Dawkins & Paul Gregg & Rosanna Scutella, 2002. "Employment Polarisation in Australia," Melbourne Institute Working Paper Series wp2002n09, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    • Handle: RePEc:iae:iaewps:wp2002n09
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    References listed on IDEAS

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    1. Paul Gregg, 1996. "It Takes Two: Employment Polarisation in the OECD," CEP Discussion Papers dp0304, Centre for Economic Performance, LSE.
    2. Bob Gregory, 1999. "Children and the Changing Labour Market: Joblessness in Families with Dependent Children," CEPR Discussion Papers 406, Centre for Economic Policy Research, Research School of Economics, Australian National University.
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    7. Paul W. Miller, 1997. "The Burden of Unemployment on Family Units: An Overview," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 30(1), pages 16-30, March.
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    13. Peter Dawkins & Paul Gregg & Rosanna Scutella, 2002. "The Growth of Jobless Households in Australia," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 35(2), pages 133-154, June.
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    Citations

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    Cited by:

    1. David Johnson & Roger Wilkins, 2003. "The Effects of Changes in Family Composition and Employment Patterns on the Distribution of Income in Australia: 1982 to 1997-1998," Melbourne Institute Working Paper Series wp2003n19, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    2. repec:lan:wpaper:3167 is not listed on IDEAS
    3. Paul Gregg & Rosanna Scutella & Jonathan Wadsworth, 2010. "Reconciling workless measures at the individual and household level. Theory and evidence from the United States, Britain, Germany, Spain and Australia," Journal of Population Economics, Springer;European Society for Population Economics, vol. 23(1), pages 139-167, January.
    4. Deborah Cobb‐Clark & Chris Ryan & Robert Breunig, 2006. "A Couples‐Based Approach to the Problem of Workless Families," The Economic Record, The Economic Society of Australia, vol. 82(259), pages 428-444, December.
    5. Russell, Helen & Layte, Richard & Maitre, Bertrand & O'Connell, Philip J. & Whelan, Christopher T., 2004. "Work-Poor Households: The Welfare Implications of Changing Household Employment Patterns," Research Series, Economic and Social Research Institute (ESRI), number PRS52.
    6. Colin Green, 2012. "Short Term Gain, Long Term Pain," Journal of Labor Research, Springer, vol. 33(3), pages 337-352, September.
    7. repec:lan:wpaper:3012 is not listed on IDEAS
    8. repec:lan:wpaper:2918 is not listed on IDEAS
    9. Ying Ying Ida Xiao, 2024. "Labour market outcomes of the China shock in Australia," Australian Economic Papers, Wiley Blackwell, vol. 63(S1), pages 135-144, May.
    10. Nicolas Hérault & Guyonne Kalb & Rezida Zakirova, 2011. "Dynamics of Household Joblessness: Evidence from Australian Micro-Data 2001–2007," Melbourne Institute Working Paper Series wp2011n10, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    11. Rosanna Scutella & Mark Wooden, 2006. "Effects of Household Joblessness on Subjective Well-Being," Melbourne Institute Working Paper Series wp2006n10, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    12. Scutella, Rosanna & Wooden, Mark, 2008. "The effects of household joblessness on mental health," Social Science & Medicine, Elsevier, vol. 67(1), pages 88-100, July.
    13. C Green, 2009. "Short Term Gain, Long Term Pain. The Effect of Informal Job Search Methods on Post-Displacement Outcomes," Working Papers 599230, Lancaster University Management School, Economics Department.
    14. Productivity Commission, 2002. "Independent review of the Job Network," Labor and Demography 0210002, University Library of Munich, Germany.
    15. Marloes Graaf-zijl & Brian Nolan, 2011. "GINI DP 5: Household Joblessness and its Impacts on Poverty and Deprivation in Europe," GINI Discussion Papers 5, AIAS, Amsterdam Institute for Advanced Labour Studies.
    16. M. D. R. Evans & Jonathan Kelley, 2004. "Effects of Family of Origin on Women’s and Men’s Workforce Involvement," Melbourne Institute Working Paper Series wp2004n25, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.

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    JEL classification:

    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers

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