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Category: Research Reports

  • Solid Foundations, Bright Future (NSW)

    New South Wales has one of the most prosperous and productive economies in Australia, with a diverse base of economic activity and strong labour market. However, years of austerity have hollowed out its public sector, creating one of the proportionally smallest state public sectors in the country in terms of both economic activity and employment.

    Despite the instrumental role the public sector played in navigating the state through the pandemic, weak wage growth and rising inflation have compounded the impacts of austerity, leading to significant reductions in public sector real wages. While the current government’s scrapping of the wage cap and implementation of public sector wage rises has undone some of this damage, most notably the October 2023 wage rises for public school teachers, more repair is needed.

    The NSW government has a strong fiscal position with which to manage these challenges. NSW maintains nearly the highest credit rating in the country and relies on revenue bases that are both diverse and stable. Additionally, there is considerable evidence that, if needed, several options are available to increase state government revenue. As the state economy weakens in response to high interest rates and declining real incomes, the state government has the responsibility to contribute to support the economy and broader society, through expansion of public services, repair of public sector wages, and support for the most vulnerable.

    The post Solid Foundations, Bright Future appeared first on The Australia Institute's Centre for Future Work.

  • Submission: Digital Transformation of Workplaces

    Submission to inquiry on digital transformation and worker rights.

    Authors: Macdonald, Heap

    Download the full report.

  • Employee voice and new rights for workplace union delegates

    Some employers have actively placed barriers in the way of volunteer union delegates and paid officials. One study in the early 2000s found that 23% of delegates found management
    hostile, while 22% of delegates reported that management opposition to their role as a delegate had become more intense over the previous two years. Examples from various case studies, including court and industrial cases, illustrate some of the ways in which that minority of employers from workplaces with delegates expressed their hostility towards unionism and their opposition to delegates, including by placing barriers in the way of workplace union activists and delegates.

    The new regime of workplace delegates’ rights is very likely, overall, to increase the voice of employees, and thereby have positive consequences, over the long run, for pay and conditions, union membership, workplace cooperation, grievance resolution and productivity. However, the effects of new rights for paid union training leave depend very much on union responses, in particular on their subsequent reliance on classroom versus informal training and the ‘follow up’ of classroom education.

    The post Employee voice and new rights for workplace union delegates appeared first on The Australia Institute's Centre for Future Work.

  • Budget 2024-25: Resists Austerity, Reduces Inflation

    Targeted cost of living measures will directly reduce inflation in some areas (like energy and rents), while helping working Australians deal with higher prices in others (including reworked State 3 tax cuts, and support for higher wages for ECEC and aged care workers). Unlike previous years, the budget is projecting real wage gains in coming years that are actually likely to materialise — however, the damage from recent real wage cuts will take several years to repair, and further support for strong wage growth will be required, from both fiscal policy and industrial laws. The budget also spelled out initial steps in the government’s Future Made in Australia strategy to build renewable energy and related manufacturing industries; these steps are welcome but need to be expanded, and accompanied by strong and consistent measures to accelerate the phase-out of fossil fuels.

    Our team of researchers at the Centre for Future Work has parsed the budget, focusing on its impacts on work, wages, and labour markets. Please read our full briefing report.

    The post Budget 2024-25: Resists Austerity, Reduces Inflation, Targets Wage Gains appeared first on The Australia Institute's Centre for Future Work.

  • The Irrelevance of Minimum Wages to Future Inflation (2024)

    The report, co-authored by Greg Jericho (Policy Director) and Jim Stanford (Director), finds that a minimum wage rise of between five and 10 per cent in the Fair Work’s Annual Wage Review, due in June, is needed to restore the real buying power of low-paid workers to pre-pandemic trends, but would not significantly affect headline inflation.

    Key findings of the report include:

    • Last year’s decision, which lifted the minimum wage by 8.65 per cent and other award wages by 5.75 per cent, offset some but not all of the effects of recent inflation on real earnings for low-wage workers.
    • At the same time, inflation fell by 3 full percentage points.
    • There has been no significant correlation between rises in the minimum wage and inflation since 1997.
    • Raising wages by 5 to 10 per cent this year would offset recent inflation and restore the pre-pandemic trend in real wages for award-covered workers.
    • Even if fully passed on by employers, higher award wages would have no significant impact on economy-wide prices.
    • A 10 per cent increase in award wages could be fully offset, with no impact on prices at all, by just a 2 per cent reduction in corporate profits – still leaving profits far above historical levels.

    “Australia’s lowest paid workers have been hardest hit by inflation since Covid. There is a moral imperative to restore quality of life for these Australians and this analysis shows that there is no credible economic reason to deny them,” Jericho said.

    “It’s vital the Fair Work Commission ensure that the minimum wage not only keeps up with inflation, but also grows gradually in real terms – as was the trend before the pandemic.

    The post The Irrelevance of Minimum Wages to Future Inflation appeared first on The Australia Institute's Centre for Future Work.

  • Mid-Term Review of Albanese Government’s Labour Policy Reforms

    That assessment is contained in an article contained in a new special issue of the Journal of Australian Political Economy (JAPE), evaluating the government’s record on a range of issues halfway through its term. The special issue of JAPE was published on 18 December, and was edited by Prof Emeritus Frank Stilwell at the University of Sydney.

    The article reviewing the government’s labour policies was co-authored by several staff at the Centre for Future Work, including Greg Jericho, Charlie Joyce, Fiona Macdonald, David Peetz, and Jim Stanford. It considers the impacts of several government initiatives, including:

    • Successive rounds of reforms to the Fair Work Act (including last year’s Secure Jobs, Better Pay bill, and this year’s Closing Loopholes legislation).
    • Several reforms to address gender inequality in workplaces.
    • A more ambitious approach to raising the national minimum wage.
    • Longer-run proposals for attaining full employment, described in the government’s recent White Paper on Jobs and Opportunities.

    The authors judge that the government’s labour reforms have achieved an “incremental but significant rebalancing of industrial relations.” They pointed to the acceleration of wage growth in Australia in the last year as evidence that workers have won important bargaining power. Wages are now growing at 4% year-over-year, according to the latest WPI data from the ABS — twice as fast as they did on average over the previous decade, which was marked by the slowest sustained wage growth in the postwar era.

    The authors caution, however, that additional reforms are necessary to reverse the erosion of collective bargaining coverage and union membership, and ensure that workers have the bargaining power to improve wages, job security and working conditions.

    “On the whole, the Albanese government has made cautious but useful progress on industrial relations and labour issues during its first year. However, it must be acknowledged that the overall labour relations regime in Australia remains heavily skewed in favour of employers,” the authors concluded.

    Please see the full article, “Labour Policy,” by Greg Jericho, Charlie Joyce, Fiona Macdonald, David Peetz and Jim Stanford, at the link below. Fiona Macdonald also authored a second article in the special issue, dealing with the government’s reforms to care policies. To see the full collection of articles in the special issue, visit the JAPE website.

    The post Mid-Term Review of Albanese Government’s Labour Policy Reforms appeared first on The Australia Institute's Centre for Future Work.

  • A Better Future for Self-Employment (gig work)

    The first is that self-employment is inexorably growing. The second is that self-employment cannot, or should not, be regulated in order to protect self-employed workers and improve the conditions of their work.

    This new report from the Carmichael Centre at the Centre for Future Work shows that, in reality, self-employment is not growing inexorably — in fact, in most countries (including Australia) it is declining.

    The much-trumpeted surge in self-employment and ‘freelancing’ is a myth. However, the nature of self-employment is changing: fewer self-employed people are running successful independent businesses, and more are engaged in precarious ‘solo’ activities like short-term contracting and part-time ‘gig’ work.

    The report also shows that some forms of self-employment can be regulated to protect affected workers, provided two simple and important criteria are satisfied: the workers are vulnerable and hence need protection, and a viable mechanism exists that enables their work to be efficiently regulated.

    The report reviews the proposed provisions of the second part of the federal government’s new Closing Loopholes legislation, which would allow for minimum labour standards to be applied to digital platform workers and owner-operators in the transportation sector. The new legislation (to be considered in Parliament in 2024) is an appropriate and effective response to the challenges facing these two groups of ‘gig’ workers.

    Please see the full report, “A Better Future for Self-Employment: How is it changing, and how can ‘gig’ work be regulated?,” by David Peetz, Laurie Carmichael Distinguished Research Fellow at the Centre for Future Work.

    The post A Better Future for Self-Employment appeared first on The Australia Institute's Centre for Future Work.

  • Short Changed: Unpaid Overtime (GHOTD 2023)

    Following the disruptions of the COVID pandemic and historic falls in real wages over recent years, 2023’s stronger labour market conditions should benefit many workers. Wages have risen, labour force participation is relatively high and unemployment is low. With the introduction of the Government’s 2022 industrial relations reforms, workers are in a better position to bargain, as shown in recent bargaining outcomes and improving wages growth. However, wages are not keeping up with prices, inflation is high and, for many workers, conditions of work are far from satisfactory.

    As this year’s GHOTD report shows, significant problems of overwork and underemployment co-exist, affecting many workers across all industries, occupations and age groups. Underemployment particularly affects workers in casual, temporary and other forms of insecure work, and it particularly affects workers in lower-paid roles. Women, younger workers, older workers and services workers are over-represented among those affected. At the same time long hours and overwork remain a problem, especially for full-time workers.

    The post Short Changed appeared first on The Australia Institute's Centre for Future Work.

  • Submission: Fair Work Amendment (Closing Loopholes) Bill 2023

    Submission supporting the Closing Loopholes Bill 2023.

    Authors: Macdonald, Peetz, Stanford

    Download the full report.

  • Going Backwards: NDIS Workforce and Gender Equality

    Hundreds of thousands of NDIS participants rely on this workforce to provide personal support and care on a daily basis.

    The NDIS workforce is large and growing, currently employing about a quarter of a million workers, mostly women. Pay, working conditions and career opportunities in the disability support workforce are critical to the future of women’s economic equality in Australia.

    It is a decade since the NDIS was first piloted, yet the promise for workers, that the scheme would translate into ‘greater pay, … better working conditions … (and) enough resources to do the job properly’ has not been fulfilled.

    Rather, conditions of work in the NDIS are poor and deteriorating.

    The design of the NDIS, with its market basis and poor and uneven regulatory oversight, has undermined fair pay and working conditions for disability support workers and is threatening workforce stability.

    This briefing paper reviews this evidence and argues for significant reforms to address urgent problems arising from these design flaws and regulatory failures.

    The post Going Backwards appeared first on The Australia Institute's Centre for Future Work.