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Productivity and the Structure of Employment

Staff research paper

This paper by Paula Barnes, Rick Johnson, Anthony Kulys and Scott Hook was released on 26 July 1999. The paper focuses on the relationship between multifactor productivity growth and the structure of employment. The objective is to examine whether multifactor productivity growth is associated with changes in key characteristics of employment that are the focus of community attention:

  • 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 - changes in the incidence of these work arrangements; and
  • earnings - the impact on the distribution of earnings.

The paper does not seek to establish causation. It only examines if there is any correlation between multifactor productivity growth and changes in the structure of employment. The paper builds on work published in the earlier Industry Commission research paper, Assessing Australia's Productivity Performance.

One important structural characteristic not covered in this paper is the regional dimension. Some aspects of regional employment are examined in the Commission research paper, Aspects of Structual Change in Australia.

This paper also examines only 'net' effects on structural characteristics. For example, the net change in employment in a particular occupation is a combination of outflows (separations) and inflows (new hirings). Consequently, any impact that productivity growth may have on turnover in (say) an occupation will not be picked up. This affects interpretation of the results. For example, job security may be related more precisely to outflows (job separations) than to net flows.

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Cover, Copyright, Contents, Preface, Abbreviations and explanations, Overview

1 Scope of the paper

2 Methodology and data
2.1 Methodology
2.2 Data

3 Industry perspective on productivity and employment
3.1 Employment by industry
3.2 Industry trends in output, productivity and employment

4 Employment by skill
4.1 Factors affecting skilled employment
4.2 Skill composition of the employed workforce and productivity
4.3 Measurement of skill
4.4 Educational attainment
4.5 Occupation
4.6 Summary

5 Employment by age
5.1 Factors affecting the age profile of the employed workforce
5.2 Age and productivity
5.3 Trends in employment by age group
5.4 Relationship between productivity growth and the age profile of employment
5.5 Summary

6 Part-time and casual employment
6.1 Factors affecting the extent of part-time and casual employment
6.2 Part-time and casual employment and productivity
6.3 Part-time employment
6.4 Casual employment
6.5 Summary

7 Employee earnings
7.1 Factors affecting employee earnings
7.2 Growth in productivity and earnings
7.3 Trends in earnings
7.4 Relationship between earnings and productivity growth
7.5 Summary

A Data sources and explanations
A.1 Industry classification concordances
A.2 Standard errors for employment data
A.3 Employment by educational attainment
A.4 Employment by occupation
A.5 Employment by age
A.6 Employment by full-time and part-time status
A.7 Employment by permanent and casual status
A.8 Employee earnings by occupation and skill-based occupation groups
A.9 Multifactor productivity

B Scatter plot details
B.1 Exclusions from scatter plots based on standard errors
B.2 Tests for significance of results
B.3 Alternative estimates for employment by occupation group
B.4 Estimates for manufacturing industry groups

C Manufacturing sector
C.1 Employment by manufacturing industry group
C.2 Trends in output, productivity and employment for the manufacturing industry groups
C.3 Structure of employment among the manufacturing industry groups