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What is Happening to Full-Time Jobs?
Tony Kryger
Statistics Group
3 March 1998
Introduction
Full-time jobs, relative to the size of the population, are in decline.
Over the past 20 years, the full-time employment to population (FTEP)
ratio has fallen from 49 to 42 per cent. This fall however, has been anything
but steady with most of the damage occurring at times of recession. The
fall in the FTEP ratio in the 1982-83 and 1990-91 recessions was sudden
and sharp, and was not fully reversed during the period of economic recovery
which followed (see Figure 1).
Differences by Gender
The phenomenon of a declining FTEP ratio is largely confined to males.
Figure 2 shows that, while males and females have experienced a sudden
decline in the ratio with each recession, for males the ratio (of full-time
male jobs to male population) has tended to flatten out after each recession
whereas for females the ratio (of full-time female jobs to female population)
has increased after each recession. The net effect is that the male FTEP
ratio has been on a trend downward for the last 20 years whereas the female
FTEP ratio has slowly trended upwards.
Differences by Industry
Figure 3 shows the change in the FTEP ratio by industry division between
1984 and 1997. Manufacturing industry has experienced the biggest fall
in the ratio over the period, but still remains by far the largest provider
of full-time jobs. It should be noted however, that part of the loss in
the FTEP ratio for manufacturing industry is due to an outsourcing of
functions to service industries. In other words, the loss of manufacturing
employment does not necessarily mean a commensurate loss of manufacturing
function. Figure 3 also shows that only five industries have increased
their FTEP ratio since 1984 and these all occur in the services sector.
The pattern of decline in the FTEP ratio varies significantly between
industries (Figure 4). In some industries-agriculture; mining;
and electricity, gas and water-the decline has been fairly steady over
time. Other industries have followed a cyclical, but downward trend over
time-examples are wholesale trade; retail trade; and communication services.
Manu-facturing industry has exhibited its own particular trend with the
ratio falling suddenly at times of recession, but remaining fairly steady
thereafter. Other industries, however, have gone against the downward
trend altogether and have increased their FTEP ratio-accommodation, cafes
and restaurants; property and business services; and personal and other
services.
Why?
Several factors have contributed to the overall decline in the FTEP ratio:
- Structural change (or change in the industry composition of the workforce)
has significantly altered the distribution of employment by full-time
and part-time status. During the past couple of decades, manufacturing
industry, a major provider of full-time jobs, has been in decline. At
the same time however, the service industries, which are major providers
of part-time jobs, have been experiencing strong growth. Particularly
strong growth has been recorded in those service industries with very
strong concentrations of part-time workers, viz. property and business
services; retail trade; health and community services; and accommodation,
cafes and restaurants. Structural change however, does not explain why
there has been a decline in the FTEP ratio within a large number
of industries (Figure 3).
- Fixed labour costs of full-time labour has meant that part-time work,
and especially part-time casual work, offers significant advantages
to employers. Employers have the choice to either 'hire or fire' casual
staff as they need them rather than keep idle people on the payroll.
Employers also have the choice of purchasing the services of casual
staff through a contractor who in turn may either employ staff on a
contract basis or 'refer' clients to the principal employer. Moreover,
it can often be cheaper to employ casuals, even if they receive more
remuneration per hour than full-timers for the same work. This is because
casuals, as yet, do not qualify for costly employment benefits such
as sick leave and recreation leave. The sudden and permanent fall in
the FTEP ratio during times of recession may be a response to this factor.
- Increased participation by women in the workforce, many of whom prefer
to work part-time, has given employers a ready supply of female part-time
labour from which to choose. While it is probably true that the greater
availability of part-time jobs has been the main inducement for women
to enter the workforce, an effect in the opposite direction is also
likely. That is, the increased supply of female labour has given employers
an incentive to alter working arrangements in order to tap into this
supply of labour.
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