93 Australian economists and policy experts have signed an open letter, initiated by the Centre for Future Work, supporting a government wage subsidy to prevent mass unemployment during the coming economic downturn resulting from the COVID-19 pandemic.
The letter and the full list of signatories is reprinted below. It has been forwarded to Prime Minister Morrison.Read more
The Centre for Future Work has made a submission to the 2020 annual wage review conducted by the Fair Work Commission. The submission compiles evidence showing that the annual minimum wage adjustments (which flow through into wages specified in the Modern Awards, as well as some enterprise agreements and individual contracts) have played a more important role in recent years in supporting the overall level of wage growth in Australia's labour market. Without relatively strong minimum wage increases since 2017 (of 3% or higher for three consecutive years), Australian wage growth would still be languishing at all-time record lows of under 2% per year.
In this context, the Centre argued it is vital the Commission proceed with a normal, healthy minimum wage increase for 1 July, 2020, with full flow-through into Award wages. Otherwise wage growth will slump significantly (to an estimated 0.7%, or even lower), heightening the risk of economy-wide deflation.Read more
The scale and scope of the economic downturn caused by COVID-19 will be unprecedented in our lifetimes. Mainstream economists have belatedly realised the pandemic will cause an economic downturn, but they are not yet appreciating the size of that downturn, nor the unconventional responses that will be required. Simply calling for government "stimulus" is sadly inadequate, given the complete shut-down of work and production that is occurring in many sectors of the economy. The task is no longer supporting markets with incremental "pump-priming." What's needed is a war-like effort, led by government, to mobilise every possible resource to protect Australians' health and livelihoods. Money is not an object - and this epic effort should not be held back by normal acquiescence to private-sector priorities and decisions.
That's the core message of new analysis by Centre for Future Work Director Dr. Jim Stanford, published today by the Australian journal New Matilda.Read more
The Australian government is still delaying needed measures to support workers in casual, self-employed, or gig positions during the unprecedented labour market turmoil resulting from the COVID-19 pandemic. Other countries, however, are moving quickly with unprecedented measures to support jobs and incomes for all workers - including those in non-standard employment - to ensure they can take necessary time away from work, and do not lose their livelihoods as a result of the virus.
We have assembled a catalogue of international initiatives. Australia must learn quickly from the experience of these other countries.Read more
While women have made some progress in closing the wage gap and other dimensions of gender inequality in Australia, they still face daunting and persistent barriers to their full participation and compensation in Australia's economy.
That's the conclusion from a new Factbook on gender economic inequality in Australia, released by the Centre for Future Work to coincide with International Women's Day on 8 March.Read more
There has been much discussion in recent months about the apparent slowdown in Australian productivity growth. Rather than dredging up the usual wish-list of the business community (more deregulation, more privatisation, and more deunionisation), it's time to look at the deeper, structural factors behind stagnant productivity. In this commentary, Dr. Anis Chowdhury, Associate of the Centre for Future Work, looks to the perverse role of our overdeveloped financial sector in slowing down productivity-enhancing investment and innovation.Read more
New research from the Centre for Future Work has dramatised the lasting consequences for workers' lifetime incomes – even after they retire – of wage freezes.
A wage freeze is often described as a "temporary sacrifice," that supposedly ends once normal annual wage increments are restored. However, this report confirms that the legacy of even a temporary pay freeze is a permanent reduction in lifetime incomes and superannuation, which can easily ultimately result in hundreds of thousands of dollars of lost income. These long-term effects are illustrated with reference to a real-world example: an 18-month pay freeze imposed on workers at Jetstar in 2014-2016.Read more
In a new guest commentary for the journal Canadian Dimension, Centre for Future Work Director Jim Stanford argues that existing power relationships in the labour market are being reinforced, more than disrupted, by the process of technological change.
Stanford highlights seven ways in which the nature of work and employment is demonstrating a fundamental continuity, despite changes in technology and work organisation: ranging from the predominance of wage labour in the economy, to employers' continuing interest in extracting maximum labour effort for the least possible labour cost.Read more
Centre for Future Work Director Jim Stanford gave a seminar presentation in Sydney on 21 November based on his research paper about the historical and empirical relationship between superannuation contributions and wage growth. Watch a summary version of his talk below. The full paper is posted at: The Relationship Between Superannuation Contributions and Wages in Australia.
The latest economic statistics have confirmed that Australia's economy is barely limping along - with quarterly GDP growth of just 0.4%. One of the weakest spots in the report was consumer spending, which recorded its weakest performance since December 2008 (amidst the worst days of the Global Financial Crisis). This was despite the supposed benefit of recent Commonwealth government tax cuts in boosting disposable income and stimulating more spending.
Analysis from Dr. Jim Stanford shows that the tax cut is in fact completely invisible in the macroeconomic data.Read more