Unemployment in Australia: Causes, Measurement, and Policies

Unemployment in Australia 1
Economics Assignment
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Unemployment in Australia 2
Unemployment Reasons
Undeniably, unemployment is a scourge in various economies and the Australian
context is no exception. The unemployment patterns in the Australian economy are rising due to
changing production patterns being experienced in the country, the unemployment levels have
risen too .In addition, there is the technological adaptation in the various production sectors of
the economy which has rendered some workers unemployed due to the lack of the required skill
set to fit in with the technological advances (Economy Watch 2010).Alongside changing
production pattern and technologies, the Australian economy unemployment rate is due to the
low demand for labor following the harsh business cycles within which the Australian
entrepreneurs are battling. The low demand for labor has contributed to the slow pace of hiring
labor services by entrepreneurs (Reserve bank of Australia 2013).Currently, Australian business
have been facing tough cyclical business cycles due to the low economic growth and investment
rates. In addition, the stagnation in the wage growth level of the Australian minimum wage is not
considered an incentive for the unemployed to seek employment opportunities thus the increased
rate of unemployment (Sloan 2018).Typically, an increase in wage growth is likely to trigger
more employment opportunities as the reverse is true.
Underemployment
Predominantly, there are two types of under-employment. Namely, visible and invisible
underemployment (Amadeo 2018).Essentially, underemployment represents the state of working
for less hours as compared to the normal working hours for that particular work. Typically,
underemployment is part-time employment whereby employees are allocated a few hours to
work in a particular field of work whereas full time employment is inclusive of more working
hours. Basically visible under-employment entails working for fewer hours than usual whereas

Unemployment in Australia 3
invisible unemployment denotes the state of inadequate income. According to recent statistics by
the Australian bureau of Statistics, the male Australian population have been experiencing
visible unemployment. Specifically, the Australian male population has been working for an
average of one hundred and fifty-five hours weekly (Murphy 2018).This is a typical case of
under-employment which requires government intervention to create more full-time employment
opportunities. Primarily, invisible unemployment happens within the income of employed
persons. The detection of invisible underemployment isn’t easy. Through invisible
unemployment, the income of employed workers is inadequate in sustaining their basic needs.
The fact there is low wage growth in the Australian economy might be indications of invisible
unemployment trends in the country though not conclusive proof.
Unemployment Causes in Australia
Noteworthy, structural unemployment is among the major types of unemployment in the
Australian economy. Basically, this type of unemployment is due to the lack of relevant skills for
the current employment opportunities thus causing unemployment (Burgess 2017).Among the
Australian population being structurally unemployed is the youthful Australian population .Due
to their lack of adequate and relevant skills and expertise, most of the Australian youths are
unemployed. It is imperative that the Australian government introduce training
opportunities ,nationalized curriculum tuned to the current market needs so as to adequately
prepare the Australian youths for the labor market after finishing schooling. Also, the preference
for migrant labor patterns over indigenous labor has left most of the Australian population
unemployed .The preference of migrant over indigenous labor is due to the cheaper wages for
migrant based labor (Koukoulas 2017).It is imperative that the Australian government regulate
the influx of migrants into the labor market to avoid creating pressure on existing jobs and

Unemployment in Australia 4
unemployment of indigenous labor force (Rafi 2017).There ought to be a balance between
migrant and indigenous labor participation in the Australian economy to reduce the overall
unemployment rate and to ensure that Australian indigenous population is economically
empowered through employment opportunities and friendly wages to afford basic needs for their
respective households.
How Unemployment is measured in the Australian economy.
Notably, the Australian economy measure and definition of unemployed persons is the
same as the global definition. Basically, to be unemployed in Australia requires the fulfillment of
three conditions. Essentially person is unemployed if they were actively seeking to be employed
for a week with no success and would have been willing to be employed in the even that the
employment opportunity had availed itself(Economy watch 2010).Predominantly, the mandate to
measure unemployment trends in the Australian industry falls on the Australian bureau of
Statistics. The importance of measuring unemployment lies in the fact that the Australian
government requires such statistics for national planning and welfare resource allocation among
other uses. Majorly, the unemployment statistic show persons who are actively looking for
employment opportunities but are unable to access employment opportunities within the
Australian economy. Majorly, the Australian unemployment index considers persons who are
over the ages of fifteen years old and are actively looking for employment opportunities but are
yet to get them as unemployed. Majorly, the Australian unemployment covers the youth, aging
person’s unemployment, underemployment and overemployment among other forms of
unemployment. Mainly, unemployment is calculated based on hours (Reserve bank of Australia
2013).