How we invented ‘unemployment’ – and why we’re outgrowing it

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How we invented ‘unemployment’ – and why we’re outgrowing it
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Labour markets confound easy distinctions between working and not working, and there’s no particular degree of desire for work that clearly distinguishes the “unemployed” from “not in the labour force”, writes Anthony O'Donnell | OPINION

The truth is the official measure of unemployment does what it says on the box. It counts those without work who are available to work and looking for work.covering 50,000 people each month, there’s little reason to question its accuracy.“Unemployment” as we have come to understand it is a fairly new concept., before the Second World War censuses tended to divide the population differently – into breadwinners and dependants.

The context was US president Franklin D. Roosevelt’s determination to fight unemployment through job creation schemes. The advantage of this new categorisation was that it gave a measure of immediate unmet demand for work. Looking back, what was exceptional about the postwar decades is that usually the new definitions were easy to apply. If you were in work, the chances were you were in full-time work; if you weren’t in full-time work, the chances were you weren’t working at all, and that you were either wanting work or none.

And the main questions don’t pick up underemployment. Australia has one of the largest part-time workforces in the OECD, which is why the Bureau of Statistics also asks workers whether they would like more hours, and reports the answers alongside the unemployment rate. What this total tells us will be quite different to the count of the number of Australians on unemployment benefits.

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