PARTICIPATION POTENTIAL

Labour force participation includes those persons of working-age in an economy who in the reference period are:

• employed; or
• unemployed but actively looking for a job and available to start.

By analysing the characteristics of those persons not participating in the labour force it can provide insights into Australia's potential labour force. This section analyses persons not in the labour force that are marginally attached, not marginally attached, discouraged job seekers, and employed persons that are underemployed and would like additional hours.

PERSONS NOT IN THE LABOUR FORCE

The persons not in the labour force framework below classifies persons aged 15 and over, who can be divided into those who are marginally attached to the labour force, and those who are not. Persons who are marginally attached to the labour force satisfy some, but not all, of the criteria required to be classified as unemployed.

Persons not in the labour force are considered to be marginally attached to the labour force if they:

• wanted to work and were actively looking for work (but, unlike unemployed persons, were not available to start work in the reference week); or
• wanted to work and were not actively looking for work but were available to start work within four weeks.

Persons not in the labour force are not marginally attached to the labour force if they:

• did not want to work; or
• wanted to work but were not actively looking for work and were not available to start work within four weeks.

nb Data have been randomly adjusted to avoid the release of confidential data. Discrepancies may occur between sums of the component items and totals.

The main activity reported for those not in the labour force was retired (39%) followed by home duties (14%) and attending an educational institution (14%). Both males and females reported retired (46% and 34% respectively) followed by attending educational institution for males (18%) and home duties for females (21%). (Datacube 9)

MARGINALLY ATTACHED TO THE LABOUR FORCE

In February 2017, there were 1 million persons with marginal attachment to the labour force, this represented 16% of persons not in the labour force.

Of those with marginal attachment to the labour force:

• 63% were females;
• 94% were not actively looking for work, but were available to start work within four weeks;
• the highest proportion were aged 15–24 years (32%). (Datacube 8)

There were 790,000 persons with marginal attachment to the labour force who had worked before. Of these, 42% had worked less than 12 months ago, and a further 18% had worked one to two years ago. (Datacube 9)

The graph below outlines selected main activities of the 1 million persons with marginal attachment to the labour force. The highest proportions were 28% attending an educational institution, 20% doing home duties and 20% caring for children.

The number of persons who were marginally attached to the labour force but not actively looking for work and available to start work within four weeks, increased from 954,800 in 2016 to 985,100 in 2017. (Datacube 1)

WITHOUT MARGINAL ATTACHMENT TO THE LABOUR FORCE

There were 5.6 million persons aged 15 years and over without marginal attachment to the labour force. Of these:

• 58% were females;
• 84% reported that they did not want to work, or did not know if they wanted to work;
• 5% wanted to work but were not actively looking for work and were not available to start work within four weeks; and
• 11% were permanently unable to work. (Datacube 1)

The graph below shows the activities of persons without marginal attachment to the labour force. The most common reasons reported were retired (45%) (52% males and 41% females), followed by persons having own health condition (15%) and doing home duties (13%). (Datacube 9)



DISCOURAGED JOB SEEKERS

There were 101,500 discouraged job seekers, of whom 57% were females. Discouraged job seekers are those persons with marginal attachment to the labour force who wanted to work and were available to start work within the next four weeks but whose main reason for not actively looking for work was that they believed they would not find a job for any of the following reasons as shown in the graph below:

• considered to be too young or too old by employers (32%);
• no jobs in their locality or line of work or no jobs at all (31%);
• lacked necessary schooling, training, skills or experience (17%);
• no jobs with suitable hours (10%):
• difficulties because of language or ethnic background (7%); or
• believed ill health or disability discourages employers (6%). (Datacube 11)

Other selected characteristics of discouraged job seekers included:

• 20% who never had a job;
• 29% of persons whose main activity when not in the labour force was home duties, followed by retired (24%); and
• 31% who were over the age of 65, while a further 6% were aged 35–44. (Datacube 8 and 9)

UNDEREMPLOYED WORKERS

The ABS conceptual framework below for underemployment separates employed persons into two mutually exclusive groups:

• workers who were considered to be fully employed, comprising:
  • employed persons who worked full-time during the reference week (including persons who usually worked part-time);
  • employed persons who usually worked full-time but worked part-time in the reference week for non-economic reasons (including illness or injury, leave, holiday or flextime, and personal reasons); and
  • part-time workers (who usually worked part-time and did so in the reference week) who would not prefer additional hours of work.
• workers who were not fully employed, comprising:
  • part-time workers who would prefer to work more hours; and
  • full-time workers who worked part-time in the reference week for economic reasons (such as being stood down or insufficient work being available).

The conceptual framework further defines workers who were underemployed, comprising:

• part-time workers who preferred to work more hours and were available to start work with more hours, either in the reference week or in the four weeks following the survey; and
• full-time workers who worked part-time hours in the reference week for economic reasons (such as being stood down or insufficient work being available).

nb Data have been randomly adjusted to avoid the release of confidential data. Discrepancies may occur between sums of the component items and totals.

UNDEREMPLOYED PART-TIME WORKERS

In February 2017 there were 1.1 million underemployed workers, of whom 1 million worked part-time and 91,600 who usually worked full-time, but worked part-time in the reference week due to economic reasons. (Datacube 2 and 21)

Of the 1 million underemployed part-time workers 60% were female. Almost a quarter (24%) of underemployed part-time males and 12% of females reported that they would move interstate if offered a suitable job. (Datacube 6)

Around 31% of underemployed part-time workers aged 15–19 had experienced insufficient work for one year or more. This compared to 53% aged 45 years and over. (Datacube 5)

The most commonly reported steps taken to look for work or more hours, in the last four weeks, by underemployed part-time workers, were:

• looked at advertisements for jobs on the Internet in a newspaper or on noticeboards (39%);
• wrote, phoned or applied in person to an employer for work (34%);
• asked current employer for more work (31%); and
• answered an advertisement for a job on the internet, in a newspaper or on noticeboards (31%). (Datacube 6)

The most commonly reported difficulty in finding work¹ for underemployed part-time workers were:

• too many applicants for available jobs (9%);
• no vacancies in line of work (5%); and
• insufficient work experience (5%). (Datacube 7)

In February 2017, 6% of underemployed part-time workers reported that they did not have any difficulties in finding work and a further 51% who did not look for work or more hours. (Datacube 7)

The preferred number of extra hours of underemployed part–time workers varied with the number of hours they usually worked, as seen in the graph below. Approximately 64% of those who usually worked less than 10 hours a week preferred to work 10 or more extra hours per week. (Datacube 6)



The mean preferred number of extra hours per week for underemployed part-time workers was 13.5 hours. The mean preferred number of extra hours was lowest for persons aged 15–19 years (12.2 hours), and highest for those aged 25–34 years (14.5 hours). On average, males preferred to work an extra 15 hours per week, compared with females who preferred to work an extra 12.5 hours per week. Males preferred more hours than females in all age groups, except persons aged 15-19 years. (Datacube 6)

End Note:
1. Reported difficulties in finding work refer to respondents perception in the reasons for not being able to find work. It includes people who reported not have difficulty finding work.