Productivity and the structure of employment

In recent years there have been community concerns in Australia about job security and the employment implications of government reforms and other factors that enhance productivity. However, a study by the Industry Commission (IC) in 1997 indicated that although there is not a negative long-term relationship between productivity growth and employment at the aggregate level, productivity growth may affect employment in particular industries, occupations and regions. This paper builds on the earlier work by the IC and focuses on the relationships between multifactor productivity growth and the structure of employment. In particular, the paper's objective is to investigate whether multifactor productivity growth has an association with changes in the key characteristics of employment of most concern to the community: industry; skill (the impact on workers with lower educational attainment or in low-skilled occupations); age (the effects on younger and older workers); part-time and casual employment status (changes in the incidence of these work arrangements); and the impact on the distribution of earnings. The authors examined employment patterns in industries for differences between high productivity growth industries and low productivity growth industries. They also sought to identify any relationships between industry productivity growth and changes in industry employment profiles.

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