Australian Wage Research Articles

‘Australian sailors wanted’: Labour supply and Australian shipping, c. 1870–c. 1914

AbstractIn the pre‐1914 era Australia did not develop an ocean‐going merchant navy. The problem is well recognised in previous studies that assumed that it was high Australian wages that made the operational cost of deep‐sea vessels uncompetitive on a global scale. This article reconstructs historical shifts in the Australian market for a seagoing workforce and demonstrates there was low recruitment of Australian labour. Drawing on new sources and inspired by efficiency wage theory the article argues that it was this shortage of a domestic labour supply that constrained the development of a national deep‐sea shipping industry.

Quantifying the Societal Benefits From Telehealth: Productivity and Reduced Travel

ObjectivesTo quantify the societal benefit of telehealth in terms of the reduction in lost productivity. MethodsUsing a case study approach, retrospective data were examined for all telehealth outpatient consults in Queensland, Australia during a 1-year period from July 2017 to June 2018. The productivity gains when individuals had specialist consults via telehealth were estimated using the human capital method by multiplying the estimated travel time with the average Australian daily wage. ResultsA total of 30 149 outpatient consults were identified for this analysis. It was estimated that the use of telehealth for these outpatient consults avoided 9 644 569 km of travel (5 992 857 miles) and 27 068 days away from usual activities. Using the average Australian wage and the estimated travel time for these outpatient telehealth consults, the overall productivity gain for society was estimated at A$9 176 052 or A$304 per consult. ConclusionConsideration of the costs and potential savings attributed to the delivery of telehealth services is important for service planning and government investment. Our study highlights the benefits from a societal perspective. When healthcare is provided using telehealth instead of in person, there are likely to be productivity benefits for both the patients and society.

Analysing the employment impact of Sunday wage premiums reductions: Implications for minimum wage research

This article tests the employment impact of recent reductions in Australian wage premiums, or penalty rates, using surveys of 1828 employees and 236 employers in Retail and Hospitality sectors. In applying wage premium reductions for Sunday work, the national regulator, the Fair Work Commission, anticipated improvements in trading hours, employment and hours worked as a consequence. However, the authors found no statistically significant evidence for these predictions. Nor did difference-in-differences methods indicate substitution of workers subject to cuts for those who were exempt. The authors present the first systematic purpose-designed empirical evidence on the employment impact of wage premiums. In the absence of empirical evidence, the regulator had referred substantially to minimum wage research. This study also has implications for minimum wage research, and contributes to it with a novel methodology examining both aggregate hours and employment, comparing those subject to cuts with those not, and surveying both employees and employers.

A TALE OF TWO WAGE SUBSIDIES

In July 2020, COVID-19 had been suppressed in Australia but continued to spread across the United States. Both countries instituted lock-downs and fiscal support, but Australia experienced a milder recession, highlighting the role of public health measures in protecting the economy. Cash stimulus is less useful than in a normal recession, justifying wage subsidies encouraging businesses to retain workers. The Australian wage subsidy, delivered via the tax authority, was better targeted, more generous, more accessible, but slower than the American wage subsidy delivered via banks. The experience highlights the need for investments in IRS infrastructure to better prepare for future crises.

From equal pay to overcoming undervaluation: The Australian National Pay Equity Coalition 1988–2011

Australian feminists have struggled to define the International Labour Organisation’s Equal Remuneration Convention’ goal of gender pay equity and find a platform for achieving it. Approaches based on discrimination, or a male comparator, have proved unworkable. Networking nationally and internationally, the National Pay Equity Coalition (1988–2011) formulated many submissions to industrial tribunals and parliamentary inquiries. Early interventions argued the disadvantages to women of the decentralisation of bargaining in the 1990s, but following the failure of discrimination-based cases, this focus shifted. National Pay Equity Coalition submissions came to define the gender gap, not as one between women and male comparators, but as a recognition gap. They argued that indicators of a history of gender-based undervaluation should lead to a bias-free work value assessment. Bias lay in the distance between actual job demands and their characterisation in classification descriptions. It could be redressed by fuller recognition of the work value of feminised service roles. This approach to the recognition and remedy of undervaluation informed the 1998 NSW Pay Equity Inquiry and the NSW Equal Remuneration Principle, but is not recognised in federal labour law. No Equal Remuneration Principle yet applies in the federal jurisdiction which since 2009 has governed most Australian wage setting amidst growing social inequality.

The Western Australian wage structure and gender wage gap: A post-mining boom analysis

Whilst there is a large literature on the determinant of wages in Australia, relatively few studies have examined the determinants of wages at a state level. In this article, we present a study of the determinants of earnings in Western Australia, a state that experienced rapid growth during the mining boom of 2003–2013. We show that the relatively stronger wage growth in Western Australia since 2001 is the product of both compositional and price effects. We also report on the Western Australia and rest of Australia gender wage gaps. Our decomposition analysis of the mean gender wage gap shows that industry effects (as a result of gender segmentation across industry) account for a much larger share of the Western Australia gender wage gap than they do elsewhere in Australia, with the mining, construction and transport sectors driving the industry effects. Using quantile analysis we show that, relative to the rest of Australia, the Western Australia gender wage gaps are larger at both the bottom and the top of the wage distribution. At the median the Western Australia gender wage gap, at 2014–2016, is on par with that prevailing elsewhere in Australia, with women in both groups earning 10% less than their male counterparts, all else held equal.

Work Disability in Australia: An Overview of Prevalence, Expenditure, Support Systems and Services.

Purpose This study sought to describe Australian systems of income support for people with work disability. Specific aims were to summarise and compare the features of the income support systems, including the rehabilitation and employment services funded or provided by those systems, and factors affecting transition between systems. Further objectives were to estimate the prevalence of work disability in Australia and the national expenditure on work disability income support. Methods A mixed methods project involving collation and analysis of existing publicly available documentation and data, and interviews with 25 experts across ten major systems of income support. The prevalence of work disability and expenditure in each system, and in total, was estimated using publicly accessible data sources. System features and service models were synthesised from data sources, tabulated and compared qualitatively. Results In Australia during the 2015/2016 financial year an estimated 786,000 people with work disability received income support from a Commonwealth, state, territory or private source. An additional 6.5million people accessed employer provided leave entitlements for short periods of work incapacity. A total of $37.2billion Australian dollars was spent on income support for these people during the year. This support was provided through a complex array of government authorities, private sector insurers and employers. Service models vary substantially between systems, with case management the only service provided across all systems. Healthcare and return to work services were provided in some systems, although models differed markedly between systems. Income support ranged from 19 to 100% of earnings for a person earning the average weekly Australian wage pre-disability. There is a paucity of information relating to movement between systems of support, however it is likely that many thousands of people with long periods of work disability transition between systems annually. Conclusions This study demonstrates the substantial financial and human impact of work disability on Australian society. Findings indicate multiple opportunities for reducing the burden of work disability, including aligning case management and healthcare service models, and engaging employers in prevention and rehabilitation. The findings suggest a need for greater interrogation and evaluation of Australian work disability support systems.

Why Are Australian Wages Lagging and What Can Be Done About It?

AbstractWages in Australia have lagged behind the growth in labour productivity in recent years. This has been associated with a significant change in the distribution of income in favour of high‐income earners. Although a number of factors appear to have been involved in this development, an important explanation is also to be found in the change in the balance of power in favour of employers and against workers and unions. As changes in industrial relations laws have contributed substantially to this imbalance, a return to the earlier laws may be necessary to restore the institutional mechanism for wages growth.

Why Has Australian Wages Growth Been So Low? A Phillips Curve Perspective

Wages growth in Australia has recently been the lowest in two decades. One possible explanation is a decline in the non‐accelerating inflation rate of unemployment (NAIRU). We examine this hypothesis by estimating a wage Phillips curve including a time‐varying NAIRU. Our findings are: (i) the NAIRU has recently been around 5.5 per cent; (ii) our approach increases the precision of the NAIRU estimates; (iii) low inflation expectations have been an important contributing factor; and (iv) the long‐run annual wages growth is nearly 3 per cent. We also find that the underutilisation rate suggests greater slack exists, but is less useful in explaining wage developments.

‘Fair Work’ and the Modernization of Australian Labour Standards: A Case of Institutional Plasticity Entrenching Deepening Wage Inequality

AbstractAustralia was long recognized for its relatively compressed wage structure. From the 1940s to the 1970s this was associated with a comprehensive regime of ‘award‐based’ minimum wages. Since the 1980s, this has been subjected to comprehensive ‘modernization’. After three decades of reform and in the most supportive economic environment in the OECD, Australian wage inequality has deepened. Although multiple political‐economic forces have been at play, the evolution of Australia's labour standards regime is an example of ‘institutional plasticity’ whereby the purpose and operations of wage‐setting institutions not only evolves but can actually be inverted over time.

Development of the Workplace Health Savings Calculator: a practical tool to measure economic impact from reduced absenteeism and staff turnover in workplace health promotion.

BackgroundWorkplace health promotion is focussed on improving the health and wellbeing of workers. Although quantifiable effectiveness and economic evidence is variable, workplace health promotion is recognised by both government and business stakeholders as potentially beneficial for worker health and economic advantage. Despite the current debate on whether conclusive positive outcomes exist, governments are investing, and business engagement is necessary for value to be realised. Practical tools are needed to assist decision makers in developing the business case for workplace health promotion programs. Our primary objective was to develop an evidence-based, simple and easy-to-use resource (calculator) for Australian employers interested in workplace health investment figures.ResultsThree phases were undertaken to develop the calculator. First, evidence from a literature review located appropriate effectiveness measures. Second, a review of employer-facilitated programs aimed at improving the health and wellbeing of employees was utilised to identify change estimates surrounding these measures, and third, currently available online evaluation tools and models were investigated. We present a simple web-based calculator for use by employers who wish to estimate potential annual savings associated with implementing a successful workplace health promotion program. The calculator uses effectiveness measures (absenteeism and staff turnover rates) and change estimates sourced from 55 case studies to generate the annual savings an employer may potentially gain. Australian wage statistics were used to calculate replacement costs due to staff turnover. The calculator was named the Workplace Health Savings Calculator and adapted and reproduced on the Healthy Workers web portal by the Australian Commonwealth Government Department of Health and Ageing.ConclusionThe Workplace Health Savings Calculator is a simple online business tool that aims to engage employers and to assist participation, development and implementation of workplace health promotion programs.

Practice and research in Australian massage therapy: a national workforce survey.

Massage is the largest complementary medicine profession in Australia, in terms of public utilisation, practitioner distribution, and number of practitioners, and is being increasingly integrated into the Australian health care system. However, despite the increasing importance of massage therapists in Australian health care delivery, or the increased practice and education obligations this may entail, there has been little exploration of practice, research, and education characteristics of the Australian massage therapist workforce. To identify practice, research, and education characteristics among the Australian massage therapist workforce. The Australian massage therapy profession. 301 randomly selected members of the Association of Massage Therapists (Australia). A 15-item, cross-sectional telephone survey. Massage therapists' demographic information, practice characteristics, and education and research characteristics. Most respondents (73.8%) worked 20 hours per week or less practising massage, nearly half of all respondents (46.8%) treated fewer than 10 massage clients per week, and over three-quarters (81.7%) of respondents were self-employed. Massage therapy was the sole source of income for just over half (55.0%) of the study respondents. Only 5.7% of respondents earned over the average wage ($50,000) through their massage activities. Nearly half of all respondents (43.3%) reported regularly exceeding their continuing professional education (CPE) quota mandated by their professional association. However, 21.1% reported struggling to achieve their CPE quota each year. Over one-third of respondents (35.6%) were not interested in acquiring further CPE points beyond minimum requirements. Respondents were significantly more likely to have an active approach to research if they had higher income (p = .015). Multivariate analysis showed factors associated with access to CPE to be the only significant predictors for increased CPE. The massage profession in Australia remains largely part-time and practitioners earn less than the average Australian wage. The factors that underlie research and education involvement appear to be highly individualised and, therefore, policies targeting specific groups may be arbitrary and ineffective.

Pharmaceuticals, pharmacists and profits.

I am writing in response to the editorials on Pharmaceuticals, pharmacists and profits (Aust Prescr 2014;37:146-7 and 148-9). I enjoyed reading the Pharmacy Guild’s perspective on troubles facing the industry. However, the editorial failed to mention the financial troubles facing community pharmacists who are not pharmacy owners. Few people, including those studying to become pharmacists, are aware that the award rate for a full-time pharmacist in charge is $27.16/hour (equivalent to $53 674 annual salary).1 Note that pharmacist interns, pharmacists and experienced pharmacists are all paid less than this. To compare, an unqualified experienced retail employee may earn up to $44 787.2 Pharmacists’ wages are significantly below the average Australian wage of $76 804 before tax.3 From this wage, a pharmacist must pay to be registered for insurance and course fees for 40 hours of continuing professional development per year. Debt from university fees must also be paid. There is a current oversupply of pharmacists, and jobs for salaried pharmacists are not easy to obtain. I understand that some pharmacies are currently experiencing a period of hardship. But should salaried pharmacists be the ones to subsidise the industry by being forced to accept these low rates of pay?

Australian Wage Policy: Infancy and Adolescence, by Keith Hancock (University of Adelaide Press, Adelaide, 2013), pp. 731.

Australian Wage Policy: Infancy and Adolescence, by Keith Hancock (University of Adelaide Press, Adelaide, 2013), pp. 731.

Keith Hancock, Australian Wage Policy: Infancy and Adolescence. University of Adelaide Press: Adelaide, SA, Australia, 2013; 731 pp. USD77.00 (also available as a free book in an Ebook PDF edition from http://www.adelaide.edu.au/press/titles/wage-policy).

Keith Hancock, Australian Wage Policy: Infancy and Adolescence. University of Adelaide Press: Adelaide, SA, Australia, 2013; 731 pp. USD77.00 (also available as a free book in an Ebook PDF edition from http://www.adelaide.edu.au/press/titles/wage-policy).

Work and Wages at a Melbourne Factory, the Guest Biscuit Works 1870–1921

The story of wages in nineteenth‐ and early twentieth‐century Australia has largely been told through official published statistics and the experiences of skilled artisans and construction labourers. Utilising wage book data from an early successful manufacturing plant – a biscuit factory – we reveal the earning histories of several neglected groups of Australian workers. We specifically investigate the effects of the 1890s depression, the introduction of a wages board, and shifting demographics on the wages of unskilled factory hands, women, juvenile workers, and commercial clerks. We demonstrate that typical Australian wage series studies have misinterpreted the impact of these phenomena.

Indigenous Livelihoods and Art Income: participation, production and returns from woodcarvings in Arnhem Land, north Australia

Participation in the Indigenous visual arts sector provides one of few market opportunities for Indigenous Australians resident on remote Aboriginal lands. In this article we examine the economic factors that influence this market engagement as they relate to woodcarving in the Maningrida region of Arnhem Land. In particular, we look at the factors that affect participation, production and monetary returns using scan and focal sampling, resource accounting and sales data from the regional art centre. Artists were engaged in a range of activities of which art production was the prominent means of productive cash income generation. An artist's residence and also their language community were found to influence the amount of sculpture production undertaken, with artists residing on ‘country’ in the hinterland being more engaged in sculpture production than those living in the township of Maningrida. The annual income earned by an artist for carving was highly variable and a large proportion of woodcarvers also earned income from producing artwork in other media. Capital costs were relatively minor, with travel costs and labour the main input into carving production. Based on the average return for a single woodcarving, $160, we estimate the average hourly return to artists as between $12 and $14. Whilst this figure is relatively low and comparable to the Australian award wage for unskilled labour, the income earned from arts production makes an important contribution to people's livelihoods.

Continuity and Change in the Australian Minimum Wage Setting System: The Legacy of the Commission

Australia has a long history of institutional minimum wage determination. We examine the features and the changes in the minimum wages system. We identify its enduring characteristics, its place the Australian system in an international context and see where Fair Work Australia is located in relation to previous arrangements. We ask why a minimum wage system is still required and we examine the legacy of the Australian Industrial Relations Commission and its predecessors in minimum wage determination.

The Quest for Fairness in Australian Minimum Wages

The attainment of ‘fairness’ is widely regarded as a worthy goal of setting minimum wages, but opinions differ sharply over how to achieve it. This article examines how interpretations of fairness shaped the minimum wage decisions of the Australian Industrial Relations Commission between 1997 and 2005. It explores the Commission's approaches to three aspects of fairness in minimum wages: first, eligibility for increases; second, the form of increase; and third, the rate of increase over time. The Australian Industrial Relations Commission consistently gave minimum wage increases that were expressed in dollar values and applied to all federal awards. Its decisions delivered real wage increases for the lowest paid, but led to falls in real and relative wages for the majority of award-reliant workers. Fair Work Australia, the authority now responsible for setting minimum wages in the national system, appears apprehensive about parts of the Australian Industrial Relations Commission's legacy and has foreshadowed a different approach, particularly with respect to the form of adjustment.

PLAYER SHARES OF REVENUE IN AUSTRALIA AND OVERSEAS PROFESSIONAL TEAM SPORTS

This paper benchmarks the shares of revenue obtained by players in Australia's five major team sports—Australian football, rugby league, rugby union, soccer and cricket—with those achieved in North America and European soccer. The shares Australian players receive are relatively low, ranging from approximately 18 to 29 per cent. Shares in American sports are approximately 58 per cent, in European soccer, except for Germany, between 63 and 68 per cent. Moreover, in some cases, the share of revenue Australian players receive has been in decline, has been less than increases experienced by the population as a whole, and there are players who earn less than the Australian adult minimum wage. The paper concludes that to the extent that various Australian sports experience financial problems it is not due to payments made to players.