Workplace flexibility has its limits – bend too far and something breaks | Greg Jericho

Now that the election has been won, suddenly employer groups and the government are talking up the need for industrial relations “reform”. It is a push that, inevitably, is for more flexibility. But as the latest annual data from the Australian Bureau of Statistics on labour force participation, mobility and job search reveals, this increased flexibility is a major driver of the current historically high levels of underemployment and the associated low wages growth.  One of the things that is often forgotten amid the monthly unemployment rates is that, for the most part, people who are in work stay in work, and also mostly stay working at the same place. In the 12 months to February this year, fewer than 10% of all people employed changed employers – well below the record highs of the late 1980s, early 1990s:  Not only are more of us staying with our current employers, we are staying with them for longer. In the past 12 months, 45% of employees had been with the same employer for more than five years. While that is a slight fall from 2016, it remains well above the levels of 20 or 30 years ago:  A big reason for this is that, since the 1980s and 1990s, industrial relations laws have become more “flexible” – with a much greater ability for employers to cut back on hours rather than lay off workers. So even when times are tough, people are more likely to stay employed but on fewer hours; compared with in the past when they would have been more likely to be retrenched. More people than ever need a second job to help pay the bills | Greg Jericho  But with this flexibility has also come a much greater incidence of part-time work and underemployment.  The increase in underemployment, however, is not because full-time workers are having their hours cut back but that part-time work as a whole has become more common. Work that was once done full-time is now on a part-time basis – and creates a much more “flexible” situation. But one that leaves workers desperate for more hours.  A common misconception is that the rise in underemployment since the GFC has been due to full-time worker hours being cut. In reality fewer than 1% of full-time workers are underemployed – roughly around where it has been since 1980.  The big driver of underemployment is the growth of part-time work.  In 1993 a record 28.1% of all part-time workers were underemployed compared with 25.5% in 2019. But in 1993 those underemployed workers made up just 6.6% of all employed, whereas now they account for 8%:  The reason is, in 1993 23% of all employed worked part-time, compared with 32% now. More part-time workers equals more underemployed.  But this does not mean it is a meaningless issue, because since the GFC not only has part-time work been growing, so too has the underemployment of part-time workers:  In 2007, 20% of men and 14% of women part-time workers were underemployed – now it is 31% and 23% respectively.  Surprisingly fewer underemployed part-time workers than in th

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