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Curtin University
Curtin Business School

2008

 

Vol 11 Number 1

Author Title Article
Daniel Perkins, Rosanna Scutella and Paul Flatau Introduction to the Special Issue on Low Paid Work in Australia, Realities and Responses

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Joan R. Rodgers and Douglas Robson Travail to No Avail? Working Poverty in Australia Since 2000

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Iain Campbell and Manu Peeters Low Pay, Compressed Schedules and High Work Intensity: A Study of Contract Cleaners in Australia

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Anthony D. LaMontagne, Deborah Vallance and Tessa Keegel Occupational Skill Level and Hazardous Exposures among Working Victorians

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Ian Watson Low Paid Jobs and Unemployment: Churning in the Australian Labour Market, 2001 to 2006

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Daniel Perkins and Rosanna Scutella Improving Employment Retention and Advancement of Low-Paid Workers

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ABSTRACTS

Vol 11 Number 1

Daniel Perkins, Rosanna Scutella and Paul Flatau

Introduction

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Joan R. Rodgers and Douglas Robson

 

 

 

 

 

 

 

During the last decade or so Australia has experienced high rates of economic growth and low levels of unemployment, conditions that are expected to have a favourable impact on working people at the lower end of the income distribution. But similar conditions in other countries have been accompanied by unexpectedly high rates of poverty among working people and their dependents. This paper investigates the extent and nature of working poverty in Australia. A recent Senate Inquiry claimed that working poverty is the 'new face of poverty in post-industrial Australia'. The aim of this paper is to determine whether this claim is valid.

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Iain Campbell and Manu Peeters

 

 

 

 

 

 

 

Contract cleaners are a significant group of low-paid workers in Australia. This paper examines their pay and working conditions, drawing on ABS data, documents and other secondary literature, as well as a program of interviews with cleaners and cleaning managers. We argue that low pay for this group of workers is linked not only to low hourly rates but also to short and irregular hours of paid work. This draws attention to the fact that contract cleaners face problems that extend beyond pay rates to other aspects of job quality such as work schedules and workloads. The dominant profile for cleaning work is one of low pay, compressed schedules and high work intensity. We suggest that this unfortunate mix of job characteristics is anchored in the structure of the industry and the practices of property owners, property tenants and cleaning companies. Particularly important are the imperatives of labour cost-cutting, which push contract cleaning companies to intensify work and to avoid minimum labour standards.

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Anthony D. LaMontagne, Deborah Vallance and Tessa Keegel

This paper examines the patterning of exposures to occupational hazards in relation to occupational skill level as a proxy for pay rate, testing the general hypothesis that exposures to occupational hazards increase in prevalence with decreasing skill level. A population-based telephone survey was conducted on a random sample of working Victorians (N = 1,101). A set of 10 indicators of exposure to occupational hazards were analysed individually and as a summary scale in multivariate regression models. A significant increasing trend in hazardous working conditions from the highest to lowest occupational skill level was observed, with those in lower skill level jobs twice as likely to be exposed as those at the highest skill level. This overall trend was driven primarily by higher exposure in the middle skill level group (technicians and skilled
trades) as well as the lowest (labourers and elementary clerical), the two main bluecollar groups. Findings provided partial support for the hypothesised relationship.

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Ian Watson

 

 

 

 

This article explores the links between low pay, unemployment and labour market churning over the period 2001 to 2006. The issue of churning is explored through analysis of the HILDA calendar data, in which job starts and job terminations are modelled using mutinomial logit regressions. The results are further explored using multilevel binomial logit models. Predicted probabilities of moving from job to job,from unemployment into jobs, and from jobs into unemployment, are calculated and these show that low paid, low skilled workers are highly vulnerable to labour market churning. Certain demographic groups, particularly migrants from particular regions, are also shown to be vulnerable. The results reinforce the importance of labour market policies which prioritise job continuity, skills development and earnings improvement rather than simply focusing on job attainment.

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Daniel Perkins and Rosanna Scutella

 

 

 

 

Little is known in Australia as to whether the types of jobs that disadvantaged jobseekers are encouraged to enter do actually provide the basis for a ‘successful’ transition into
the labour market. At the very least, this ‘successful’ transition would consist of being able to retain employment. Ideally, it would then lead to career advancement and wage progression. This study outlines the support provided by existing employment assistance programs to enable disadvantaged job seekers to make such a transition, then uses the Household Income and Labour Dynamics in Australia (HILDA) survey to examine the extent to which low-skilled jobseekers both retain employment and then advance. Aggregate figures highlight problems with jobseekers retaining employment with at least circumstantial evidence of a ‘low-pay no-pay’ cycle in the Australian labour market. We conclude that to improve employment retention and advancement of the low-skilled, current employment assistance programs should be expanded to include a range of retention and advancement strategies that have been developed in the US and the UK.

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Vol 11 Number 2

Author Title Article
Kostas Mavromaras Introduction to the Special Issue on papers presented at the December 2007 Australian Labour Market Research Workshop

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Anton Hallam and Ernst Juerg Weber Labour Taxes and Work Hours in Australia

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Donatella Cavagnoli Addiction to Work: An Inelastic Wage Elasticity of Labour Supply Equals Long Hours of Work

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Marcia Keegan and Michael Corliss The Labour Force Participation of Young Mothers versus Older Mothers

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Geoff Perry and Tim Maloney Economic Evaluation of the Training Opportunities Programme in New Zealand

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Vol 11 Number 2

Kostas Mavromaras

Introduction

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Anton Hallam and Ernst Juerg Weber

 

 

 

In the 1970s, work hours in Europe were similar to work hours in the United States, but today Europeans work less than Americans. Prescott (2004) attributes the decline in European work hours to an increase in the effective marginal tax rate on labour income. Applying Prescott’s dynamic general equilibrium model to Australian labour market data confirms that the taxation of labour income is an important determinant of the decision to work. In this paper it is found that a temporary increase in taxes reduced Australian work hours in the 1980s, while taxes and work hours did not change much in the long-run. The resilience of Australian work hours in the 1990s suggests that a return to the tax rates of the 1970s would restore the European labour supply.

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Donatella Cavagnoli

 

 

 

A phenomenon of the last twenty years is the growth of ‘very long hours’ of work, especially amongst high-skilled labour. This is an unexpected reversal of a long trend in the opposite direction. This paper criticises the Beckerian analysis of labour-leisure choice. It argues that the more time is consumed in paid work, the more are preferencesfor paid work affected by it; thereby creating a vicious cycle of consumption patterns which lead to longer than expected hours of work.

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Marcia Keegan and Michael Corliss

 

 

 

Previous research has suggested that women who have a baby before age 25 are more likely to drop out of the labour force than women who have a baby after turning 25. In addition, the research found younger mothers stay out of work for longer. This paper will use data from the six waves of HILDA to evaluate and discuss the factors that influence the labour force participation of younger mothers. Some of the possible explanations that will be examined are that more experienced women have greater flexibility to negotiate family friendly working conditions; that younger women have lower earning potential and find parenting payments or relying on her spouse a better alternative; or that women with few career ambitions are less likely to delay
childbearing until after 25.

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Geoff Perry and Tim Maloney

 

 

 

It is well accepted that a highly educated and well trained labour force is a precondition for sustained economic growth and development, and that the labour market outcomes for individuals are enhanced with higher levels of education and training. Recognition of these facts has influenced the types of active labour market programmes that are provided for the unemployed by governments throughout the OECD, with particular emphasis on training. In New Zealand, the Training Opportunities scheme, introduced in the early 1990’s, remains today the major active labour market programme for the unemployed. This paper contributes to the literature in two ways. Firstly, the impact on male participants of being involved in Training Opportunities in the mid 1990’s is evaluated. Secondly, short and medium term impacts for men are estimated using Difference-in-Differences matching, with careful attention to methodological concerns. The key findings are that while there is a short term beneficial effect for the programme as a whole, this is not consistent across all sub-groups. Further, the beneficial effect dissipates by the second year after receiving the intervention.

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Vol 11 Number 3

Author Title Article
Scott Baum and William Mitchell Adequate Employment, Underutilisation and Unemployment: an Analysis of Labour Force Outcomes for Australian Youth

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Alfred Michael Dockery, Rachel Ong, Paul Flatau and Gavin A. Wood An Analysis of the Impact of Tax and Welfare Reform Measures on Effective Marginal Tax Rates in Australia 1982-2002

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James Giesecke and G.A. Meagher Population Ageing and Structural Adjustment

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John Creedy A Note on Discounting and the Social Time Preference Rate

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John Creedy

Pedagogic Paper

Choosing the Tax Rate in a Linear Income Tax Structure

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Vol 11 Number 3

Scott Baum and William Mitchell

This paper considers youth labour market disadvantage and presents an analysis which juxtaposes the role of individual supply characteristics with labour demand characteristics to advance an understanding of youth labour market outcomes. The paper takes the concept of employability and using data from the Household Income and Labour Dynamics Australia (HILDA) survey and the Australian Bureau of Statistics Household and Population Census develops probit regressions of separate labour force states against individual supply-side and regional level demand characteristics.
The results illustrate the importance of considering both supply side and demand side characteristics when considering labour market outcomes and developing potential policy interventions.

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Alfred Michael Dockery, Rachel Ong, Paul Flatau and Gavin A. Wood

This paper uses a microsimulation model that permits interactions between taxes, government benefits and housing assistance parameters and data from various releases of the Survey of Income and Housing Costs to illustrate how the distribution of effective marginal tax rates has varied between the years of 1982, 1996, C3_-_meagher.pdf000 and 2002. The policy impact of changes in the tax benefit system on effective marginal tax rates is then assessed by applying the real tax-benefit parameters from 1982, 1996 and 2002 to the household composition and income data from a base year (2000). The findings indicate that effective marginal tax rates have increased over the long-term. Even when the impacts of tax-benefit changes are isolated from changes in the composition of the population, policy changes have been insufficient to counteract increases in effective marginal tax rates that have been caused by compositional changes.

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James Giesecke and G.A. Meagher

 

The future effects of population ageing on the Australian economy have been widely canvassed in recent years, most notably in government reports concerned with its
budgetary position. On the income side, they focus on how ageing affects labour supply and gross domestic product. On the expenditure side, they focus on how ageing affects
various spending categories including education, health and aged care. This paper provides a complementary analysis in that it considers how the structure of the economy is likely to be affected by these influences. In particular, it analyses the effects on 64 skill groups, 81 occupations and 106 industries. The effects are modelled by comparing two economies: a base case in which population ageing takes place, and an alternative (counterfactual) economy in which the age structure of the population remains unchanged. The simulations are conducted using the MONASH applied general equilibrium model of the Australian economy and cover the period from 2004-05 to 2024-25. The paper pays particular attention to
the implications of the analysis for economic policy.

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John Creedy

 

This paper examines the discounting of money values in social evaluations using a social time preference rate (defined as the sum of a pure time preference rate and the product of the elasticity of marginal valuation and a growth rate). It is shown that this procedure can give a different ranking of alternative streams compared with the direct use of the pure time preference rate to discount ‘social welfare’ in each period (where social welfare is a - usually isoelastic - function of money values).

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John Creedy

This paper considers the choice of linear income tax rate in both majority voting and social welfare maximising contexts. Although the basic problem in each case - of finding the most preferred tax for the median voter and the welfare maximising tax for an independent judge or decision-maker - can be simply stated, it is usually not possibleto obtain explicit solutions even for simple assumptions about preferences and population heterogeneity. The present paper instead gives special attention to a formulation of the required conditions in terms of easily interpreted magnitudes, the elasticity of average earnings with respect to the tax rate and a measure of inequality.
The inequality measure takes the same basic form in each model, depending either on median earnings or a weighted average of earnings where the weights depend on value judgements regarding inequality aversion. The approach enables the comparative static effects of a range of parameter changes to be considered. The results are reinforced using numerical examples based on the constant elasticity of substitution utility function.

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