Submission 167 Australian Council of Trade Unions Workplace Relations Framework Public inquiry

Underemployment

It is important to highlight the problematic aspect of this flexibility and to emphasise the need for various employment protections. First, economic recovery may not lead to substantial increases in full-time employment and the 2010s may repeat the experience of ‘jobless growth’ but in a new form. Secondly, this large increase in underemployment has serious implications for household living standards: it meant that considerable numbers of workers were not gaining sufficient hours of work to meet their financial needs. This problem is evident in the data on preferred hours for employees (Table ).

As reported in the HILDA data, part-time workers are particularly vulnerable to the problems of inadequate hours. When asked for their preferred hours of work, 10 per cent of male full-time employees in 2013 indicated they wanted more hours; the figure for female full-time employees was just 4 per cent (). Among the part-time workforce, on the other hand, the figures were exceedingly high: 45 per cent of male part-timers in 2013 indicated they wanted more hours and 30 per cent of female part-timers wanted more work. At one stage in the early 2000s the male figure reached 50 per cent and the female figure reached 34 per cent.

These percentages changed over the period from 2001 to 2013 (Figure ). For full-time employees there was a steady decline until 2007, followed by a rise through to 2010, before plateauing. More dramatic were the changes for part-time employees. Among male part-time employees there were steep declines through to 2008, followed by a steady rise after 2008. The figures for female part-time employment were more stable. Some of the variability for male part-timers reflects sampling variability (because of their smaller sample size) but is also consistent with the increasing use of part-time labour over this period. The high percentages for part-timers, both male and female, does suggest that despite increased employer utilisation of part-time employment, the hours on offer do not provide part-time employees with sufficient hours of work.

How many more hours would employees who are under-employed prefer to work? Fortunately, HILDA allows us to answer that question by comparing their actual hours with their preferred hours and calculating the ‘deficit’. In 2013 the deficit among male full-time employees was 10 hours and among female full-time employees it was 9 hours (Table ). For the part-time workforce, the figures were higher: for male employees it was 13 hours and for female employees it was 11 hours. Nevertheless, for all categories the figures were quite high: between 9 and 13 hours. In other words, for some workers unable to work their preferred hours they faced a shortfall in employment of about one and a half days per week.
Figure : Employees preferring more hours of work, by sex and hours status, Australia 2001 to 2013

Y axis shows percentage of employees who preferred to work more hours.

Source: HILDA Release 13.

Table : Employee preferring more hours and number of extra hours, Australia, 2013

	Male		Female
	Full-time	Part-time	Full-time	Part-time
Percentage preferring more hours	9.9	45.3	4.1	30.0
Extra hours preferred	9.9	12.7	9.1	11.0

Extra hours is shortfall in actual hours and preferred hours for those employees who preferred to work more hours. Source: HILDA Release 13.

We can also track these hours over the period from 2001 to 2013 (Figure ). What these figures suggest is that both male and female part-time employees experienced a gradual decline in their hours deficits over the period, something consistent with employers utilising more part-time hours. Some of the volatility shown is due to sampling variability, but some is also due to the impact of the GFC. At the same time, both male and female full-time employees saw their hours deficit rise over the period, particularly in the post GFC period. Again this would be consistent with employers making greater use of part-time labour.⁴⁹
Figure : Deficit in hours for employees preferring more hours of work, by sex and hours status, Australia 2001 to 2013

Y axis shows the average deficit (shortfall) between actual hours and preferred hours for those employees who preferred to work more hours. Figures weighted and based on trimmed mean (5%). Source: HILDA Release 13.