Opposition Industrial Relations spokesman Bob McMullan has rightly drawn attention to the poor distribution of work in Australia. While more than a million Australians are out of work or desperately seeking more work, others have far to much work to do and would probably like less. He calls it a paradox.
He pointed to figures showing that in 1989 full-time employees worked an average of 39.9 hours a week; that has now risen to 42.2 hours. About a third of respondents to a survey were working between 50 and 59 hours a week. Mr McMullan suggested 26 million hours a week of work could be created (enough for about 700,000 full time jobs) if those people in full-time work reduced their hours to the earlier average. “”It is an absurd situation to have some many people wanting more work while many others with jobs want less work,” he said.
The trouble is that it is neither a paradox nor absurd. Rather it can be explained as a the result of thousands of quite rational responses to the economic, governmental and union environment.
The major reason an employer would prefer to employ nine people for 45 hours each rather than 10 for 40 hours each is that the nine people cost much less for the same output. The more employees, the greater the overheads in buildings and other capital and bureaucracy (as government is more demanded per head the more employees there are).
The work cannot easily be shared around without incurring greater costs. Further, it is absurd to say that someone in the dole queue can achieve in three hours what a highly skilled employee can. The economists of the 1960s who predicted greater leisure time for all were wrong. Rather there is far too much leisure for some and not enough for others.
It may also be the case that a lot of the excess in hours worked is not really work at all. In an environment where many employees are not formally paid for overtime, there is little management incentive to send people home, so many employees are hanging about late to be seen to be working extra, without doing much constructive work. And with more unpaid overtime … the result of the decline of manufacturing employment and the increase in service and information employment … managements have not seen the need to structure work around shorter weeks with more people.
Up to a point this is sensible. If Australian businesses were forced to employ more people working fewer hours, our industry would be less competitive with the result of even greater unemployment. But there comes a time when the social and economic costs of high unemployment and the high stress of long working weeks outweighs the advantages of the more efficient use of capital.
The problem for society is that, what might be a series of sensible rational decisions by each individual employing business, has an overall irrational, destructive effect, as Mr McMullan has pointed out. But there is not some simple wand-waving solution that will enable the sharing out of work in the mathematical way that Mr McMullan suggests.
Rather the answer lies in working smarter, not longer. That might involve better use of industrial capital. It might mean round-clock shifts, so valuable capital is used more efficiently. It might mean more flexible and portable work with the use of computers. It might also mean much more freelance work, where workers have half a dozen or more contracting employers. The advantage of the latter, is that the loss of a job is nowhere near as traumatic as in the present environment.