Hidden unemployed in South Australia

Thursday, 7 February 2002

19,000 HIDDEN UNEMPLOYED IN SOUTH AUSTRALIA

NEW figures show that unemployment in South Australia may be 40% higher than official estimates indicate.

The study, by the Centre for Labour Research at Adelaide University, looked at the relationship between the labour force participation rate (the number of people working or actively seeking work) and unemployment over the last eight years.

It found that the steady decline in the male participation rate, rather than strong employment growth, was the key factor driving recent reductions in the unemployment rate. This means that unemployment is artificially low because a large number of South Australians have given up the search for work and have become the "hidden unemployed".

The study found that there are at least 19,000 hidden unemployed South Australians.

"The significant decline in the male labour force participation rate means that the number of unemployed South Australians is actually in excess of 70,000 rather than 50,800," says the Centre's Executive Director, Mr John Spoehr.

"If we adjust the official trend unemployment rate of 6.9% to take account of hidden unemployment, the unemployment rate in SA at the moment is 9.3%.

"The problem is related to the collapse of the male full-time job market. Male full-time employment declined by 2,500 over the December 1993 to December 2001 period. When you take account of the collapse in the male labour force participation rate, the real rate of unemployment for men is alarmingly high at 11.9% compared to the official rate of 7.7%.

"We need much faster employment growth. Employment grew by just 6.5% in SA compared to 17.7% for Australia over the eight years to December 2001. The real challenge is to generate secure full-time jobs. While full-time employment grew by 11.9% for Australia it grew by just 1.6% in SA.

"SA must reverse the growing gap in economic and jobs performance between South Australia and Australia if we are to generate the jobs needed to retain population," Mr Spoehr says.

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