Barriers and Incentives to Labour Force Participation, Australia

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Factors that influence how people participate in the labour market and the hours they work

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Reference period
2020-21 financial year
Released
4/11/2022
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Key statistics

In 2020-21:

  • The most common reason women were unavailable to start a job or work more hours within four weeks was 'Caring for children', while for men it was 'Long-term sickness or disability'.
  • The most important incentives for people to seek a job or more hours were the "ability to work part-time hours" and "finding a job that matches skills and experience."

More frequent and detailed data on Barriers and Incentives

On 8 September 2022, the Australian Government announced additional funding for the Australian Bureau of Statistics to more frequently measure barriers and incentives to labour force participation. 

With this funding, the ABS will now release data on barriers and incentives every year (rather than every two years), with a range of key measures released on a quarterly basis.

The ABS is also partnering across the Australian Public Service to identify data that can provide information on how different groups of people participate in the labour market. Further initiatives are described below in Making greater use of other data.

Related data can also be found in the annual Participation, Job Search and Mobility topic, which is collected in conjunction with the Labour Force Survey every February (see Potential workers and Underemployed workers).

Financial year 2020-21

In 2020-21, of the 18 million people aged 18 to 75 years:

  • there were 9.5 million people who did not work full-time
  • there were 3.2 million people not participating in the labour force (excluding retirees and those unable to work), of whom 28% wanted a job 
  • there were 1.0 million people working less than 16 hours, of whom 38% would like to work more hours
Table 1.1 - Labour Force Participation by preference for work or more hours, People who had a job
 Employed part-timeNot employed
 

Usually works 16-34 hours

Usually works 0-15 hours

Had a job to start or return to

People aged 18 to 75 years

2,879,300

1,036,000

259,700

Would like to work more hours

727,500 (25%)

388,600 (38%)

-

Did not want more hours

2,151,800 (75%)

647,400 (62%)

-

 

Table 1.2 - Labour Force Participation by preference for work or more hours, People who did not have a job
 Not employed
 

Unemployed looking for work

Not in the labour force

Retired or unable to work

People aged 18 to 75 years

717,500

3,027,100

1,600,200

Would like a job

717,500 (100%)

916,000 (30%)

-

Did not want a job

-

2,111,100 (70%)

-

 

COVID-19 Impacts

The latest data presented in this release of Barriers and Incentives to Labour Force Participation was collected between July 2020 and June 2021 and reflects the labour market conditions at that time. ABS advises caution when analysing the reasons why people were not or could not work during this time. As seen in other ABS releases, the increase in people reporting 'Other' for some questions reflects pandemic-related factors.  

Wanted a job or more hours

There were 2.8 million people who did not work full-time and wanted a job or preferred to work more hours. Determining whether these people were available to work or work more hours is important because those who are available have a greater potential to participate or increase their participation in the labour force than those who are not available.

Of the 2.8 million people who wanted a job or preferred to work more hours, most (2.4 million) were available to start within 4 weeks.

381,700 people were not available within four weeks or did not know when they could start a job or work more hours.

  • The main reason women were unavailable to start work was "Caring for children" (25%). This was higher for mothers with children under 15 years (56%).
  • The main reason men were unavailable to start work was "Long-term sickness or disability" (35%). 
  • For those with a long-term health condition, 33% indicated their main reason was "Long-term sickness or disability".
  • Availability refers to the reference week (last week) or within four weeks.
  • Data on the main reason is presented. More than one reason can be provided and is available in the microdata as "All reasons not available to start work or more hours."
  • Data sourced from Table 04 in Data downloads. State breakdowns and revised estimates for previous years are also available in Table 04. 
  • Availability refers to the reference week (last week) or within four weeks.
  • Data on the main reason is presented. More than one reason can be provided and is available in the microdata as "All reasons not available to start work or more hours."
  • People with a long-term health condition are based on their responses to questions related to identifying a range of health conditions. This is asked separately from the main reason why they are not available to work or work more hours, and they are able to choose a main reason other than "long-term health condition or disability."

  • Data sourced from Table 04 in Data downloads. Estimates for previous years are also available in Table 04. 

The main reasons provided by mothers who indicated childcare was the main reason they were unavailable included:

  • Preferred to stay home and look after their children (35%), and
  • Children were too young or too old for formal childcare (27%).
  • Availability refers to the reference week (last week) or within four weeks.
  • Mothers refers to women with children aged under 15 years.
  • Data sourced from Table 04 and Table 09 in Data downloads. Estimates for previous years are also available.

Difficulty finding a job or more hours

Of the 2.4 million people who wanted a job or more hours and were available to start, just over half (55%) were looking for work (1.3 million).

The main difficulties reported for finding work or more hours included:

  • Other difficulties (likely including a range of pandemic-related factors during 2020-21) – 19%
  • Too many applicants for available jobs – 18%
  • No jobs or vacancies in locality, line of work or no jobs at all – 17%
  • Lacked necessary training, qualifications or experience – 12%
  • Data on the main difficulty is presented. More than one difficulty can be provided and is available in the microdata as "All difficulties finding work or more hours."
  • Data sourced from Table 06 in Data downloads. State breakdowns and revised estimates for previous years are also available in Table 06. 
  • Data on the main difficulty is presented. More than one difficulty can be provided and is available in the microdata as "All difficulties finding work or more hours."
  • Data sourced from Table 06 in Data downloads. Estimates for previous years are also available in Table 06. 

Available and looking

Of the 1.3 million people who wanted a job or more hours, and who were available and looking:

  • 720,000 (55%) were classified as unemployed
  • 45,000 (3%) were not in the labour force (these people were not classified as unemployed because they were not available to start work in the reference week, but were available to start within 4 weeks or were only passively looking for work)
  • 540,000 (41%) were employed and usually worked part-time hours (less than 35 hours per week)

Incentives

Incentives to join or increase participation in the labour force were asked of people aged 18-75 years who were either:

  • Not in the labour force, excluding permanent retirees and people unable to work (who did not want a paid job)
  • Unemployed
  • People who usually worked part-time (less than 35 hours)
  • People who had a job to start or return to

The most important incentive for women was the "Ability to work part-time hours" with 49% of women rating this as "very important."

For men, the most important incentive was "Finding a job that matches skills and experience," with 43% rating it as "very important." 

  • Proportions calculated based on the number of people that rated the incentives as ‘Very important’.
  • Data sourced from Table 10 in Data downloads. State breakdowns and revised estimates for previous years are also available in Table 10. 

Parents with children under 15

There were 2.1 million parents aged 18-75 years with children under 15 who were not working full-time.

Of the 1.8 million mothers, the most important incentive was "Ability to work part-time hours" (64%)

Of the 330,000 fathers, the most important incentive was "Finding a job that matches skills and experience" (50%).

  • Proportions calculated based on the number of people that rated the incentives as ‘Very important’.
  • Data sourced from Table 10 in Data downloads. State breakdowns and revised estimates for previous years are also available in Table 10. 
  • Proportions calculated based on the number of people that rated the incentives as ‘Very important’.
  • Data sourced from Table 10 in Data downloads. State breakdowns and revised estimates for previous years are also available in Table 10. 

Long-term health conditions

There were 4.1 million people who were not working full-time and had a long-term health condition.

The most important incentives for people with a long-term health condition were the ability to work part-time hours (40%) and finding a job that matches skills and experience (36%).

 

  • Proportions calculated based on the number of people that rated the incentives as ‘Very important’.
  • Data sourced from Table 10 in Data downloads. State breakdowns and revised estimates for previous years are also available in Table 10. 

Available and not looking

There were 1.1 million people who wanted a job or work with more hours, were available within four weeks but were not looking. 61% of these people were women and they commonly reported that "Studying or returning to studies" (14%) and "Caring for Children" (14%) were the main reason for not looking for a job or work with more hours. The main reasons for men were "No need to work" (15%), "Studying or returning to studies" (14%) and "No jobs in locality, line or work or no jobs at all" (14%).

Did not want a job or more hours

    Approximately 8.0 million people who were not in the labour force or who worked fewer than 35 hours reported that they did not want a job or more hours.

    The main reason people not in the labour force did not want a job included:

    • Permanently retired, will not work full-time again (39%)
    • No need to work, satisfied, retired (for now) (25%)
    • Long-term sickness or disability (16%)
       
    • Data on the main reason is presented. More than one reason can be provided and is available in the microdata as "All reasons for not wanting to work or work more hours."
    • Data sourced from Table 09 in Data downloads. State breakdowns and revised estimates for previous years are also available in Table 09. 
    • Data on the main reason is presented. More than one reason can be provided and is available in the microdata as "All reasons for not wanting to work or work more hours."
    • People with a long-term health condition are based on their responses to questions related to identifying a range of health conditions. This is asked separately from the main reason why they do not want to work or work more hours, and they are able to choose a main reason other than "long-term health condition or disability."
    • Data sourced from Table 09 in Data downloads. State breakdowns and revised estimates for previous years are also available in Table 09. 

      The main reason people not in the labour force did not want a job varies at different stages of life:

      • For people aged 18-24 years - Studying or returning to studies (54%)
      • For people aged 25-39 years - Caring for children (43%)
      • For people aged 40-54 years - Long-term sickness or disability (32%)
      • For people aged 55 years and over - Permanently retired, will not work full-time again (49%)
      • Data on the main reason is presented. More than one reason can be provided and is available in the microdata as "All reasons for not wanting to work or work more hours."
      • Data sourced from Table 09 in Data downloads. State breakdowns and revised estimates for previous years are also available in Table 09. 

      For people who usually worked part-time, the main reason for not wanting more hours included:

      • No need to work more, satisfied with current arrangements (44%)
      • Caring for children (20%)
      • Studying or returning to studies (14%)
         
      • Data on the main reason is presented. More than one reason can be provided and is available in the microdata as "All reasons for not wanting to work or work more hours."
      • Data sourced from Table 09 in Data downloads. State breakdowns and revised estimates for previous years are also available in Table 09. 
      • Data on the main reason is presented. More than one reason can be provided and is available in the microdata as "All reasons for not wanting to work or work more hours."
      • People with a long-term health condition are based on their responses to questions related to identifying a range of health conditions. This is asked separately from the main reason why they do not want to work or work more hours, and they are able to choose a main reason other than "long-term health condition or disability."

      • Data sourced from Table 09 in Data downloads. Estimates for previous years are also available in Table 09. 

      June quarter 2023

      In June quarter 2023, there were 18.6 million people aged 18-75 years. Of these:

      • 13.6 million were employed or had a job to start or return to (73%)
      • 1.8 million were retired or permanently unable to work (10%)
      • 3.2 million did not have a job (17%)

      The ABS advises caution when interpreting quarterly estimates from the Barriers and Incentives to Labour Force Participation survey as the survey sample was originally designed to produce high quality annual output. From January 2023, the ABS has increased the sample and estimates for March quarter 2023 onwards are on the increased sample.

      Wanting to work

      Of the 3.2 million people who did not have a job in June quarter 2023, 1.2 million people wanted a paid job (39%) and 1.9 million people did not want a job (61%).

      • For men and women aged 18-24 years, the main reason for not wanting to work was 'Studying or returning to studies' (77%).
      • For women aged 25-39 years, the main reason was 'Caring for children' (59%).
      • For men aged 25-39 years, the main reason was 'Long-term sickness or disability' (61%).
      • For women aged 40-54 years, the main reason was 'Caring for children' (31%).
      • For men aged 40-54 years, the main reason was 'Caring for ill, disabled or elderly' (43%).

      In June quarter 2023, of those aged 18-75 years who did not have a job, were not retired and not permanently unable to work:

      • 2.0 million people had long term health conditions, and 770,000 wanted a paid job (38%)
      • 1.2 million people had disability, and 480,000 wanted a paid job (41%)

      Whether a person has disability has been derived from a subset of questions from the ABS Short Disability Module. These questions are not designed to estimate prevalence but rather allow for the broad comparison of the characteristics of people with and without disability. For more information, refer to the Glossary in Methodology. 

      People can have both long-term health conditions and disabilities. For people with long-term health conditions, about 50% also have disability. For people with disability, about 90% also have long-term health conditions. This survey does not establish if there is a relationship between a person’s long-term health conditions and their disability.

      Available to work

      Of the 1.2 million people who wanted a paid job in June quarter 2023, 930,000 were available within four weeks (75%) and 310,000 were not available within four weeks (25%).

      The main reasons women were not available to work were:

      • Long-term sickness or disability (24%).
      • Caring for children (21%).
      • Short-term sickness or injury (10%).

      The main reasons men were not available to work were:

      • Long-term sickness or disability (45%).
      • Studying or returning to studies (13%).
      • Short-term sickness or injury (2%).

      Incentives

      Of the 3.2 million people who did not have a job in June quarter 2023, the most important incentive to encourage them into the labour force was 'Finding a job that matches skills and experience', which was rated as 'Very important' by 36% of people without a job. 

      • For men and women aged 18-24 years, the most important incentive was the 'Finding a job that matches skills and experience' (64% rated as 'Very important'), followed by 'Support for training or study to improve skills' (59%).
      • For women aged 25-39 years, the most important incentives were 'Finding a job that matches skills and experience' (49%), 'Access to childcare' (47%), 'Ability to vary start or finish times' (47%), and 'Financial assistance with childcare costs' (46%).
      • For men aged 25-39 years, the most important incentives was 'Finding a job that matches skills and experience' (54%), followed by 'Working a set number of hours on set days' (50%).
      • For women aged 40-54 years, the most important incentives were 'Finding a job that matches skills and experience' (53%), 'Ability to work part-time hours' (52%) and 'Working a set number of hours on set days' (48%).
      • For men aged 40-54 years, the most important incentive was 'Finding a job that matches skills and experience' (40%), followed by 'Support for training or study to improve your skills' (24%).
      • For people with long-term health conditions, the most important incentive was 'Finding a job that matches skills and experience' (33%).
      • For people with disability, the most important incentive was 'Finding a job that matches skills and experience' (30%)

      Previous quarters

      March quarter 2023

      December quarter 2022

      Quarterly Barriers and Incentives microdata in DataLab

      Barriers and Incentives to Labour Force Participation microdata from September quarter 2014 to March quarter 2023 are available in ABS DataLab, released as a supplementary file for the Longitudinal Labour Force (LLFS) microdata. All existing users of the LLFS microdata will automatically get access to the additional file and new users can apply for access to both files. 

      Microdata for June quarter 2023 and the 2022-23 financial year are scheduled for release on 27 November 2023. 

      A detailed data item list for the Barriers and Incentives microdata is available in Microdata and TableBuilder: Barriers and Incentives to Labour Force Participation.

      Data downloads

      Download all (23.03 MB)

      Tables - Financial year

      All tables updated 7 July 2023.

      Data files
      Download all (14.38 MB)

      Tables - Quarterly measures

      Table Q3 updated 18 October 2023, all other tables updated 16 October 2023.

      Data files

      Making greater use of other data

      While data in this release provides valuable insights into barriers and incentives to labour force participation, and the extent to which they are changing over time, there is a limit to the insights that sample surveys can provide for relatively small groups of people within the population (eg. Aboriginal and Torres Strait Islander peoples).

      The ABS is partnering with other parts of the Australian Public Service to identify other data that can provide information on how different groups of people participate in the labour market. For example, administrative data provides a greater ability to produce robust estimates of changes over time for relatively small groups of people, particularly when integrated with a large demographic dataset like the Census. For a list of recent and current analysis of large administrative datasets, see Multi-Agency Data Integration Project Research Projects.  

      In addition to point-in-time survey data, administrative data and Census data, the Department of Social Services has noted significant changes in the barriers to labour market participation over time for particular groups in HILDA and other longitudinal studies. For example, that the proportion of Australians with caring responsibilities that are participating in the labour force or engaged in education or training has increased over the past 20 years.  At the same time, the opposite has been true for those with significant disability and health barriers with a proportional decrease in participation. Further analysis of longitudinal data in future years will provide additional insights.

      Data on barriers and incentives will inform the Australian Government's Employment White Paper (the White Paper) and its discussion of labour force participation. The White Paper will provide a roadmap for Australia to build a bigger, better trained and more productive workforce. As per its Terms of Reference, the White Paper will discuss improving labour force participation and employment outcomes for groups who face barriers in the labour market, including women, First Nations people, and people with disability.

      The ABS will add to this section over time, highlighting additional data initiatives across the Australian Public Service

      Additional information on 31 March 2023:

      The Australian Public Service produces data and insights into the labour market experience of Australia’s migrant cohorts, to better understand barriers they face. The Department of Home Affairs, via the Continuous Survey of Australia’s Migrants (CSAM), produces employment outcome data for the recent skilled migrant cohort. As at 2018, at the six-month stage of settlement, Australia’s skilled migrants demonstrated an employment to population ratio and labour force participation rate above that for the general population. Future CSAM releases will also include information on barriers and difficulties experienced in finding work.

      The Department of Social Services commissions Building a New Life in Australia (BNLA), a longitudinal study researching how Australia’s humanitarian migrant cohort settle into life in Australia. Information on employment and barriers that hinder positive settlement outcomes is available, the study ran from 2013 to 2018 and recommenced in 2022, with results expected to be available from early 2024 onwards.

      Jobs in Australia (JIA), produced by the ABS from the Linked Employer-Employee Dataset (LEED), now contains information on employed migrants, allowing further analysis of migrant outcomes. The ABS released the Permanent Migrants in Australia dataset on March 29 and the Temporary Visa Holders in Australia dataset will be released on April 28. These two information sources link data from the 2021 Census with data from Home Affairs. The information produced provides insights into the labour force participation of permanent and temporary migrants, by visa stream.

      Additional information on 7 July 2023:

      Since April 2023, the Department of Employment and Workplace Relations has been providing additional monthly data on people participating in the Workforce Australia program.

      Similarly, the Department of Social Services also began releasing additional data within the existing monthly data on income support recipients.

      Both releases include more detailed breakdowns than were previously available from these data, such as age groups by sex, to support further analysis of people outside of employment or who were facing barriers within the labour market.

      Additional information on 16 October 2023:

      With the release of the “Working Future” White Paper on 25 September 2023 the ABS and Treasury received investment to deliver enhanced labour market data. This investment builds on the earlier Government funding after the 2022 Jobs and Skills Summit to improve data on barriers and incentives to work. The suite of data initiatives includes:

      • Improving data on employment outcomes and barriers through linking Labour Force Survey, employment services and income support data;
      • Collecting more data – and producing new statistics – on the quality of employment, job security, barriers to job mobility and career progression, and additional insights into people who are not employed;
      • Improving the data available on the amount and value of unpaid care, to ensure its contribution to society and the economy is more visible alongside paid work; and
      • Consulting with First Nations people on more frequent data on employment outcomes.

      Additionally, Government investment is supporting the ABS to deliver the Life Course Data Initiative. This will involve developing the Life Course Data Asset to improve our understanding of how communities experience disadvantage by improving the evaluation of existing policy to inform long-term decision making.

      Related publications

      Information related to barriers and incentives is also available in: 

      History of changes

      18/10/2023

      • Table Q3 was updated to fix the labelling of data on the 'Data 3.1' tab. The data provided on the summary tab 'Table 3.1' was labelled correctly and remains unchanged. 
      16/10/2023
      • Quarterly estimates published for June quarter 2023.
      • First release of data for 'People with disability'. Whether a person has disability has been derived from a subset of questions from the ABS Short Disability Module. These questions are not designed to estimate prevalence but rather allow for the broad comparison of the characteristics of people with and without disability. For more information, refer to the Glossary in Methodology. 
      • Quarterly estimates rebenchmarked to August 2023 Labour Force Survey estimates.
      • Updates to the financial year tables and microdata in DataLab are scheduled for 27 November 2023.

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      Previous catalogue number

      This release previously used catalogue number 6239.0*.

      * Note: Catalogue number 6239.0 was previously used for Information Paper - Review of ABS Employment Statistics, 1981.

      Methodology

      Barriers and Incentives to Labour Force Participation, Australia methodology, 2020-21 financial year

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