Casualisation of work and inequality in the Australian labour market

Abstract

Australia has seen an increase in labour market inequality over recent decades. One driver for this is skill bias in the demand for labour. Another points to the casualisation of employment in Australia and to polarisation of job creation and earnings. To understand these, we conduct a simple analysis by applying data on occupational types, namely, full-time and part-time ‘casual’ and ‘permanent’ employment. The findings show polarisation in the labour market. This phenomenon occurs when the labour market experiences an increase in the share of high-paid jobs with decent working conditions, an increase in jobs with poor pay and working conditions, with an accompanying decrease in the share of jobs in the middle of the employment distribution. This outcome, we believe, is accentuated by a process of casualisation of employment. These processes may lead to a different dimension of inequality occurring in the Australian labour market, requiring new government policies to slow such trends.