Former Keating government deputy prime minister Brian Howe has warned employer groups to take a closer look at the rise of insecure work and its impact on productivity.
In a speech to the National Press Club, Howe, who chairs the independent inquiry into insecure work, said the “greatest cost of insecure work is the impact it is having on productivity and skills” at a time “when the world is moving into a globalised, information-based economy”.
“We are currently in the middle of a shallow national debate around productivity, in which business groups and the right-wing media are attempting to convince us the only way to increase productivity is to cut wages and conditions,” he said. “This ignores the fact the main long-term drivers of productivity are investment in industry, infrastructure and in the skills of workers. It also ignores the long-term effects of casualisation on the skills base of Australia, in particular of workers on the periphery of the economy.”
Howe said aside from the social cost of insecure work – which he said was substantial – the insecurity of workers “should be a concern for business” on productivity grounds if nothing else. He cited economist Mike Keating’s view that “the critical problem” Australia faced was a “structural mismatch” between labour supply and demand for labour. “There is a shortage of skilled labour and an excess supply of people with low education and skill levels,” Keating said. Howe said simply reducing pay and conditions would not lead to greater employment or productivity. “Properly training workers will,” he said. “Casualisation represents a commoditisation of workers that uses people in an instrumental and short-term manner as opposed to investing in their capabilities,” Howe said. “It represents a use and throw away mentality that does not help build a productive economy or a sustainable society in the longer term.”
Howe said the inquiry’s report would be released at the ACTU conference next month. It would recommend more than just tweaks to the Fair Work Act, he said. “I am not in a position today to go into specific details of our recommendations, but what I can say is our approach has been holistic and extends far beyond labour market regulation,” he said. “Those critics expecting us to simply recommend some further rewriting of the Fair Work Act will be disappointed.”
Source: Thomson Reuters Workforce news, 18 April 2012.
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