Today, the Australian Bureau of Statistics released the latest data – Labour Force, Australia, October 2018 – which show that the Australian labour market really was treading water despite the improvement in employment growth, from last month’s outcome where Australia endured zero growth. The moderate employment growth, however, trailed behind the growth in the labour force and unemployment rose a bit. Monthly hours worked remained on a flat trend. The labour market remains in a fairly weak state – the growth in employment is not sufficient to match the growth in labour supply and the broader measures of labour underutilisation remain at persistently elevated levels. The Australian labour market remains a considerable distance from full employment. There is clear room for some serious policy expansion at present.
Today is the mid-term elections in the US and it seems that the media is focused on how many seats the Democrats will win. As a progressive this doesn’t particularly interest me much given that the claims the Democrats have been making in the last few months about fiscal policy. Trump is out there demonstrating what expansionary fiscal policy can do when there is idle capacity. And last week’s (November 2, 2018) release by the US Bureau of Labor Statistics (BLS) of their latest labour market data – Employment Situation Summary – October 2018 – showed the employment impacts of that fiscal approach. Total non-farm employment from the payroll survey rose by a very strong 250,000 and the unemployment rate was steady at 3.5 per cent. Inflation remains subdued. The strong employment growth has also stimulated participation, which meant that the growth in the labour force has outstripped the strong employment growth and unemployment rose slightly in October. But that is the sort of dynamic that a high pressure economy exhibits and eventually the cyclical participation effects exhaust and the strong employment growth starts mopping up the last of the cyclical unemployment and underemployment. There is still some way to go for that to be the case. While the US labour market is reaching unemployment rates not seen since the late 1960s, the participation rate is still well below the pre-GFC levels and a substantial jobs deficit remains. There has also been a hollowing out of the occupational employment structure around the median pay occupations which confirms the bias towards low-pay jobs in the recovery. The employment-population ratio rose by 0.2 points in October. Taken together, the US labour market continued to improve in October but remains some distance from full employment.
Today, the Australian Bureau of Statistics released the latest data – Labour Force, Australia, September 2018 – which show that the Australian labour market has weakened, with employment growth virtually zero. Compounding that weakness was a sharp decline in the participation rate (0.3 points). Taken together, unemployment and the unemployment rate fell but this is a sign of weakness not improvement. The decline in unemployment is because workers gave up looking for jobs in a weak labour market. Monthly hours worked remained on a flat trend. Overall, my assessment is that the Australian labour market remains in a fairly weak state and, is still a considerable distance from full employment. There is clear room for some serious policy expansion at present.
On October 5, 2018, the US Bureau of Labor Statistics (BLS) released their latest labour market data – Employment Situation Summary – September 2018 – which showed that total non-farm employment from the payroll survey rose by only 134,000. The labour force survey measures show that employment growth outstripped the growth in the labour force, which resulted in the unemployment rate declining by 0.2 points to 3.69 per cent. The US labour market is reaching unemployment rates not seen since the late 1960s, although the participation rate is well below the pre-GFC levels and a substantial jobs deficit remains. The employment-population ratio rose by 0.1 points in September. Taken together, the US labour market continued to improve in September but remains some distance from full employment.
The Australian Council of Social Service (ACOSS), which represents income support recipients, in conjunction with Jobs Australia (a peak body for the not-for-profit job services providers) released a report last week (September 14, 2018) – Faces of Unemployment – which was a welcome return to a focus on joblessness and the need to provide more jobs, rather than the lame faux-progressive retreat to UBI advocacy that has dominated the policy debate for the last few years. However, once you start reading the analysis you realise that these supposedly ‘progressive’ organisations offer the same old neoliberal remedies to solving poverty and unemployment. They want: Compulsory, assisted job search, which is just coercion of jobless workers by Australia’s privatised job services industry that has an appalling record; 2. Wage subsidies in the private sector and Public sector wage subsidies – which never produce effective sustainable outcomes of sufficient magnitude to be called a solution; and vocational training, which is the same old ‘put workers on the training treadmill and shuffle the jobless queue’. This reinforces the theme I focus on a lot that the progressive elements in our society have become captured by the neoliberal mainstream and cannot think outside that frame. There is actually no mention or analysis of public sector job creation programs in the entire ACOSS/JA Report. Sadly, groups like ACOSS have a major public voice and the Federal government sees their advocacy as non-threatening because the type of policies they advocate are mainstream neoliberal and just more of what the Government, itself, thinks are viable. The irony (or disgrace) is that if these policies were effective then the ACOSS/JA Report would not have had to be written. Just imagine what they could have written about the “Faces of Unemployment” if a Job Guarantee program effectively wiped unemployment out. It would become a very short story of workers moving between jobs.
The Australian Bureau of Statistics released the latest – Labour Force, Australia, August 2018 – today which show that the Australian labour market showed better signs in August 2018 than in July but there are questions about the sensitivity of the results to the sample rotation used by the ABS to construct its survey. I expect the results to be revised downwards next month. With that said, employment growth was solid (dominated by full-time growth) and the participation rate rose. Taken together, unemployment rose slightly and the unemployment rate was steady. Monthly hours worked however hardly moved which is further reason to doubt the employment estimates. Overall, my assessment is that the Australian labour market remains in an uncertain state and, is still a considerable distance from full employment. There is clear room for some serious policy expansion at present.
The British Office of National Statistics (ONS) published its latest labour market data last week (August 14, 2018) – Labour market economic commentary: August 2018. The results are illuminating because they demonstrate how we must use broad concepts to appraise labour market health rather than just focusing on the official unemployment rate. A marked characteristic of the British labour market has been the near zero rate of growth in wages (and falling real wages) for some years, despite the claims that employment has reached record levels and the unemployment rate is now at levels unseen since the early 1970s. The research question is to dig deeper into the data to see what might be driving these relationships. The conclusion I reach is that the quality of employment has fallen somewhat over the last decade or so and the capacity of workers to successfully achieve wage settlements has fallen significantly as trade union membership has gone south. I am doing more formal research on this question to narrow down all the determinants and will report when I have more to say.
The Australian Bureau of Statistics released the latest – Labour Force, Australia, July 2018 – today which show that the Australian labour market weakened in July 2018 and one is lead to think that the June 2018 improvement was an outlier after several months of poor results earlier in the year. It looks like the labour market has settled back into that weak pattern. Overall employment growth was negative but this was all down to the teenage segment, where there were substantial losses of part-time work. Unemployment fell marginally but only because the participation rate fell by 0.1 points, which meant that the labour force contracted by more than employment. Overall, my assessment is that the Australian labour market remains in an uncertain state, but is on the weak side, and, is still a considerable distance from full employment. There is room for some serious policy expansion at present.
At present, Europe is sweltering in both relative and absolute terms as the harsh summer ensues. In Australia, we are in drought after an unseasonably warm and dry Autumn. Drought is no stranger to Australia but the frequency and circumstances of the current period coupled with what is going on around Europe (including the cold spell I was caught up in Finland in February while the North Pole struggled with heat) tells us that weather patterns are changing. There is now credible research pointing in that direction. But the drought in Australia is demonstrating another thing – the hypocrisy of the way we deal with unemployment and the unemployed vis-a-vis other groups in society that we endow with higher privilege, especially in this neoliberal era. Australia is experiencing a serious drought and Federal and State governments are tripping over each other to offer very large support packages to farmers and their communities to tide them over while their income dries up (excuse the pun). There appears to be no limit to the support these governments are announcing. The Prime Minister is wandering around rural Australia promising this and that to help farmers make ends meet. Whenever I see these special assistance packages being handed out to the rural sector, which is politically well-organised, I reflect on the plight of the unemployed. With unemployment at elevated levels in Australia, the decision to hand out economic largesse to the farmers reeks of inconsistency. The unemployed have diminishing chances of getting a job at present and the income support provided by government is well below the poverty line. That poverty gap is increasing and the Government refuses to increase the benefit claiming fiscal incapacity. The comparison of the vastly different way the government treats farmers relative to unemployed highlights, once again, that the way we construct a problem significantly affects the way we seek to solve it. The neo-liberal era has intensified these inconsistencies which have undermined the capacity of public policy to achieve its purpose – to improve the welfare of all citizens. The research question is: Why do we tolerate such inconsistent ways of thinking about policy problems and their solutions?
The Australian Bureau of Statistics released the latest – Labour Force, Australia, June 2018 – today which show that the Australian labour market gained some strength after several months of poor results. Overall employment growth was stronger with a robust increase in full-time employment, although the overall increase in monthly hours worked was modest. Unemployment fell marginally with the unemployment rate steady at 5.4 per cent. However, participation rose by 0.2 per cent and employment growth was strong enough to absorb both the underlying population growth and the new entrants into the labour force. The teenage labour market delivered mixed results – with overall employment rising disproportionately but full-time employment declining. A further grey cloud came with the rise in underemployment by 35.1 thousand to 8.6 per cent. The broad labour underutilisation rate rose to 13.73 per cent. Overall, my assessment is that the Australian labour market remains in an uncertain state and is still a considerable distance from full employment.