tag:theconversation.com,2011:/es/topics/labor-policy-16268/articlesLabor policy – The Conversation2021-05-25T12:10:24Ztag:theconversation.com,2011:article/1602242021-05-25T12:10:24Z2021-05-25T12:10:24ZWhy widespread health woes could follow from pandemic-driven job losses<figure><img src="https://images.theconversation.com/files/402017/original/file-20210520-21-1ova5q0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Empty stores and restaurants in Beverly Hills, California, closed because of the COVID-19 pandemic.</span> <span class="attribution"><a class="source" href="https://www.gettyimages.com/detail/news-photo/people-walk-past-empty-stores-and-restaurants-closed-due-to-news-photo/1212206032?adppopup=true">Getty Images</a></span></figcaption></figure><p>Being out of work isn’t bad just for your finances: It’s bad for your health. Losing a <a href="https://doi.org/10.1146/annurev-soc-071913-043237">job can cause depression, anxiety </a>and other mental health problems. <a href="https://doi.org/10.1146/annurev-soc-071913-043237">Research also consistently shows</a> that job loss and unemployment – even just for a few months – are associated with poorer physical health as well, including increased risks for cardiovascular disease, hospitalization and death. These risks can endure for years or even decades after a person returns to work. </p>
<p>As <a href="https://soc.ucla.edu/faculty/jennie-brand">researchers who study</a> the <a href="https://lsa.umich.edu/soc/people/faculty/burgards.html">health effects of job loss and unemployment</a>, we see many reasons to worry that the next wave of health problems linked to COVID-19 will not come directly from the virus itself, or the strain it places on health systems, but from its effect on the labor market. </p>
<p>During the first six months of the COVID-19 pandemic, <a href="https://www.pewresearch.org/social-trends/2020/09/24/economic-fallout-from-covid-19-continues-to-hit-lower-income-americans-the-hardest/#a-third-of-americans-say-they-have-used-money-from-a-savings-or-retirement-account-to-pay-their-bills-since-the-outbreak">25% of U.S. adults said they or someone in their household lost their job</a> because of the pandemic. Among those who said they lost a job, half reported they were still unemployed six months later. Racial and ethnic minorities have been hit hardest by pandemic-driven <a href="http://doi.org/10.3386/w27315">job losses</a> and <a href="https://doi.org/10.1093/cid/ciaa815">deaths</a>. These communities already face <a href="https://doi.org/10.1093/geronb/gbaa114">long-standing structural inequities in living and working conditions</a> that affect their job prospects and may shape their financial recovery. </p>
<h2>The health impacts of job loss</h2>
<p>It’s not hard to see why losing a job, followed by a period of unemployment, can be bad for a person’s health. The initial months following a job loss can reduce social support by straining <a href="https://doi.org/10.1146/annurev-soc-073014-112204">people’s finances and psychological well-being</a> and <a href="https://doi.org/10.1353/sof.0.0083">limiting their social interactions</a>. People who lose their health insurance along with their job may not seek medical attention when illness arises. The stresses caused by losing a job can also lead people to increase the use of <a href="https://doi.org/10.1016/j.jhealeco.2010.12.009">alcohol</a> or <a href="https://doi.org/10.1016/j.drugpo.2017.03.013">drugs</a>, <a href="https://doi.org/10.1016/j.jhealeco.2010.12.009">eat poorly, exercise less</a> or develop <a href="https://doi.org/10.3386/w27814">bad sleep patterns</a>.</p>
<p>These risks persist even if someone receives unemployment benefits or gets another job relatively quickly. Some research shows <a href="https://doi.org/10.1017/S003329170000502X">a few months of unemployment</a> may be associated with worse long-term health and well-being. <a href="https://doi.org/10.1162/qjec.2009.124.3.1265">One study</a> found that in the year after the participants lost their jobs, death rates among them were as much as two times higher regardless of whether and when they got a new one, and remained 10%-15% higher than expected for the next 20 years. If this rate of increased risk continued indefinitely, the authors noted, losing a job at age 40 could reduce life expectancy by 1-1 ½ years. </p>
<p>Other research has associated job loss with a higher risk of conditions including <a href="https://doi.org/10.1353/dem.0.0050">hypertension and arthritis</a>, and a <a href="https://doi.org/10.1136/oem.2006.026823">twofold higher risk of heart attack and stroke</a>. And that’s not because people in poor health are more likely to lose their jobs. Our <a href="https://doi.org/10.1177/002214650704800403">2007 analysis</a> showed that even after removing the influence of baseline health and social background, people who lost their jobs were still more likely to report poor health. </p>
<h2>Why pandemic-driven job loss may be the next health crisis</h2>
<p>While some of the data on which we base our concern come from other economic recessions and downturns, such as the <a href="https://www.federalreservehistory.org/essays/great-recession-of-200709#:%7E:text=The%20Great%20Recession%20began%20in,recession%20since%20World%20War%20II.">Great Recession from 2007 to 2009</a>, we expect that there could be even worse outcomes in the wake of COVID-19. The peak unemployment rate during the Great Recession was 10%, while the <a href="https://fas.org/sgp/crs/misc/R46554.pdf">peak unemployment rate in 2020 was almost 15%</a>. Economic recovery is more precarious when pandemic restrictions are still in place, and <a href="https://www.washingtonpost.com/road-to-recovery/2021/02/17/unemployed-workers-retraining/">some business operations have changed permanently</a>, making it harder for some laid-off workers to regain their old jobs. </p>
<p>Moreover, many of those who became seriously ill with COVID-19 are experiencing slow recoveries. They may not be able to work at their earlier capacities for some time. Other adults may need to take on new caregiver responsibilities because kin have remained ill, or died and left behind others who need care. </p>
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<h2>What can governments do?</h2>
<p>Already, preliminary analyses are emerging about the potential health effects of COVID-related unemployment, particularly among vulnerable populations. <a href="https://doi.org/10.1101/2020.12.15.20248284">In a recent New Zealand study,</a> the researchers estimate that pandemic-related job loss could cause a 1% rise in overall cardiovascular disease rates for each additional 1% increase in unemployment. Among the nation’s more vulnerable Indigenous Māori population, however, the disease rate rose to 4% for each 1% increase in unemployment. The authors’ model also suggests that the health effects of pandemic unemployment will persist over the next two decades.</p>
<p>This suggests the need for more robust support for people who are out of work, including continued health insurance coverage, to help buffer the economic toll of job loss and thereby mitigate some of its health consequences. The U.S. has some threads of a social safety net, such as up to 26 weeks of unemployment benefits in most states, and Congress created extra pandemic help when it passed the CARES Act in 2020. But these weren’t enough to prevent a huge increase in food insecurity and <a href="https://theconversation.com/how-food-banks-help-americans-who-have-trouble-getting-enough-to-eat-148150">use of food pantries</a> last year. </p>
<p>Given the potentially long-term negative effects of job loss on health, one way to protect workers may be helping companies to not lay them off. Policymakers should continue to direct resources toward employers that keep businesses going and workers employed. If layoffs are inevitable, then create incentives to rehire laid-off workers as soon as possible. In California, for instance, Gov. Gavin Newsom signed a bill in April requiring companies in hard-hit industries such as hotel and event management <a href="https://www.latimes.com/california/story/2021-04-16/california-hospitality-workers-laid-off-during-covid-19-pandemic-get-rehire-rights">to rehire workers who were laid off during the pandemic</a> when jobs become available. </p>
<p>To address all the health consequences of the pandemic, we believe one must think broadly about interventions and policies. We must recognize the wide scope of job losses across households and industries, not just in workplaces making media headlines, and the unequal burden felt by workers already disadvantaged before COVID-19. The real solution lies in not just getting back to work, but getting Americans into secure jobs that pay a living wage and allow economic recovery alongside the healing of people and health care systems.</p>
<p><em>This article was produced in collaboration with <a href="https://knowablemagazine.org/">Knowable Magazine</a>, a digital publication covering science and its emerging frontiers.</em></p><img src="https://counter.theconversation.com/content/160224/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Sarah A. Burgard receives funding from the National Institutes of Health. </span></em></p><p class="fine-print"><em><span>Jennie E. Brand does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The health harms of pandemic-driven mass unemployment will persist for decades, even after people find new jobs.Jennie E. Brand, Professor of Sociology and Statistics, University of California, Los AngelesSarah A. Burgard, Professor of Sociology, University of MichiganLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1170972019-05-14T20:16:16Z2019-05-14T20:16:16ZBeyond the dollars: what are the major parties really promising on education?<figure><img src="https://images.theconversation.com/files/274302/original/file-20190514-60554-kfqfg5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">How do the major parties’ education commitments stack up?</span> <span class="attribution"><span class="source">from shutterstock.com</span></span></figcaption></figure><p>As voters head to the polls, <a href="https://www.abc.net.au/news/2019-04-29/poll-reveals-76-per-cent-of-voters-picked-a-side-before-campaign/11056140">around one-quarter will decide who to vote for on the day</a>. Analysis shows <a href="https://www.abc.net.au/news/2019-04-17/vote-compass-election-most-important-issues/11003192">climate change and the economy</a> are foremost in voters’ minds.</p>
<p>But education remains a key issue, as evidenced by <a href="https://www.abc.net.au/news/2019-05-07/federal-election-labor-coalition-education-policy-explained/10880502">a flurry of education-related announcements</a> in the final stretch of the campaign.</p>
<p>Here’s what you need to know about the major parties’ education commitments, and what the millions and billions here and there really mean.</p>
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Read more:
<a href="https://theconversation.com/how-has-education-policy-changed-under-the-coalition-government-113921">How has education policy changed under the Coalition government?</a>
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<h2>Early childhood education and care</h2>
<p>Two years of high-quality, play-based learning at preschool can have a <a href="http://www.mitchellinstitute.org.au/wp-content/uploads/2016/10/Two-Years-are-Better-than-One.pdf">significant impact</a> on children’s development. It can put them <a href="http://www.mitchellinstitute.org.au/wp-content/uploads/2016/10/Two-Years-are-Better-than-One.pdf">close to eight months ahead</a> in literacy by the time they start school. The benefits are <a href="https://www.aihw.gov.au/getmedia/321201fc-ca0c-4c20-9582-7c3dc5c9d1b9/19438.pdf.aspx?inline=true">greatest for children from disadvantaged backgrounds</a>, which makes preschool a valuable tool for reducing inequality.</p>
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Read more:
<a href="https://theconversation.com/both-major-parties-are-finally-talking-about-the-importance-of-preschool-heres-why-it-matters-114974">Both major parties are finally talking about the importance of preschool – here's why it matters</a>
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<p>Labor has promised to make childcare free for most low-income households and to provide up to an 85% subsidy for households under $175,000. It has committed to <a href="https://www.theguardian.com/australia-news/2018/oct/04/bill-shorten-reveals-17bn-plan-to-fund-access-to-preschool-or-kindergarten">funding an extra year of preschool</a> for three-year-olds. This is <a href="https://www.education.act.gov.au/__data/assets/pdf_file/0004/1159357/Lifting-Our-Game-Final-Report.pdf">evidence-based</a> and builds on commitments by several states to support two years of preschool.</p>
<p>Labor has also pledged to <a href="https://www.alp.org.au/media/1878/2019_labor_fiscal_plan.pdf">increase wages for some early childhood educators</a>, to be rolled out over a decade, and to reinstate funding for the National Quality Agenda, which lapsed in 2018. This reflects the <a href="http://www.mitchellinstitute.org.au/papers/quality-key-early-childhood-education-australia/">importance of quality</a> in early childhood services, to improve outcomes for children.</p>
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<span class="caption">Both the Coalition and Labor are taking early childhood education and care seriously this election.</span>
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<p>The Coalition is taking a more cautious approach to spending on the early childhood sector. <a href="https://www.theaustralian.com.au/nation/politics/review-of-preschool-funding-a-concern/news-story/9a750093c75df2cf750d6ead8e57cfc1">It has pledged funding for four-year-old preschool</a>, but only for another year, and it has not renewed funding for the National Quality Agenda.</p>
<p>The Coalition will likely retain the <a href="https://www.abc.net.au/news/2018-07-01/child-care-subsidy-changes-what-you-need-to-know/9924950">means-tested subsidy</a> introduced as part of its major childcare reforms in 2018. While these reforms benefited an estimated one million lower-income families, the means test also left around 280,000 families worse off, <a href="https://theconversation.com/labors-childcare-plan-parents-children-and-educators-stand-to-benefit-but-questions-remain-116143">including families</a> with neither parent in work.</p>
<p>Advocates argue <a href="https://www.smh.com.au/politics/federal/funding-for-preschool-places-will-shape-australia-s-future-20181011-p50905.html">preschool should be seen as an integral component of the education system</a> and a fundamental right for all children, and all parties should take a cross-partisan approach and <a href="https://www.education.act.gov.au/__data/assets/pdf_file/0004/1159357/Lifting-Our-Game-Final-Report.pdf">commit to long-term funding</a>. The major parties are certainly not at that point yet, but there are indications they’re heading in the right direction.</p>
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Read more:
<a href="https://theconversation.com/labors-childcare-plan-parents-children-and-educators-stand-to-benefit-but-questions-remain-116143">Labor's childcare plan: parents, children, and educators stand to benefit, but questions remain</a>
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<h2>Schools</h2>
<p>Given states and territories are largely responsible for schools, federal investment should be targeted where it can make the most difference. Two key areas are <a href="https://www.thesaturdaypaper.com.au/opinion/topic/2019/04/13/the-funding-gap-education/15550776007987">needs-based funding</a>, to ensure additional support is available to students who need it the most, and central investment in research and evidence-based practice. </p>
<p>Both major parties have promised a <a href="https://www.abc.net.au/radio/programs/am/evidence-institute-measure-effectiveness-australian-education/9933872">national evidence institute</a>. <a href="http://www.tanyaplibersek.com/world_class_schools_national_press_club_address_wednesday_20_february_2019">Labor</a> has allocated funds for it, with the <a href="https://theconversation.com/dont-be-fooled-billions-for-schools-in-budget-2019-arent-new-and-what-happened-to-the-national-evidence-institute-114193">Coalition</a> yet to do so. This initiative reflects the urgent need to ensure evidence helps to shape the education system. The <a href="https://www.pc.gov.au/inquiries/completed/education-evidence/report/education-evidence-overview.pdf">Productivity Commission</a> has recommended such an institute, to connect educators and policymakers with the latest research on teaching and learning.</p>
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Read more:
<a href="https://theconversation.com/three-things-australias-next-education-minister-must-prioritise-to-improve-schools-115223">Three things Australia's next education minister must prioritise to improve schools</a>
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<p>On funding, the Coalition wants us to judge it on its reforms to the <a href="https://theconversation.com/turnbull-announces-schools-funding-and-a-new-gonski-review-77011">schools funding package</a>, which is now mostly modelled on the needs-based funding approach outlined in the Gonski Review. But funding has still not reached the recommended levels. The Coalition has supported the <a href="https://www.education.gov.au/national-school-resourcing-board">National School Resourcing Board</a> to review these funding arrangements and develop a fairer model for all schools.</p>
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<p>Labor has promised to increase funding for schools. <a href="https://www.alp.org.au/policies/fair-funding-for-australian-schools/">Labor’s offer</a> would bring schools closer to meeting the levels of funding recommended by Gonski. </p>
<p>Funding isn’t a magic bullet, but it <a href="https://www.nber.org/papers/w25368.pdf">plays an important role in improving outcomes for all students.</a>.</p>
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Read more:
<a href="https://theconversation.com/what-the-next-government-needs-to-do-to-tackle-unfairness-in-school-funding-110879">What the next government needs to do to tackle unfairness in school funding</a>
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<h2>Tertiary education</h2>
<p>Vocational Education and Training (VET) has experienced a series of unsuccessful reforms over the past decade. <a href="https://www.vu.edu.au/about-vu/news-events/news/dual-sector-vcs-call-for-more-connection-between-two-systems">VET plays an important role in the tertiary sector</a>, so it’s good to see both major parties addressing this in their platforms. </p>
<p><a href="https://www.education.gov.au/skills-and-training-budget-overview-2019-20">The Coalition’s plan</a> comes out of <a href="https://www.pmc.gov.au/news-centre/domestic-policy/vet-review-completed-and-final-report-delivered-government">a major recent review of the VET sector</a> and includes more money for apprentices and rural programs; the establishment of a National Skills Commission and a National Careers Institute; and simplifying systems for employers.</p>
<p>Labor has pledged to fund up to <a href="https://www.alp.org.au/policies/fee-free-tafe/">100,000 TAFE places</a>. It has also promised a major <a href="https://www.afr.com/news/politics/labor-proposes-once-in-a-generation-university-and-tafe-inquiry-20180222-h0whln">inquiry into tertiary education</a>, looking at VET and universities side by side. This could potentially move us towards a fairer system that puts <a href="http://www.mitchellinstitute.org.au/presentations/reconceptualising-tertiary-education/">VET and universities on an even footing</a> and better caters to the varied needs of students and employers.</p>
<p>Both <a href="https://www.alp.org.au/media/1710/190404_skills_and_training_fact_sheet.pdf">Labor</a> and the <a href="https://www.liberal.org.au/our-plan-delivering-high-quality-skills-and-vocational-education">Coalition</a> have committed to increased support for apprenticeships, through financial incentives for employers. </p>
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<p>For universities, Labor says it will bring back <a href="http://www.tanyaplibersek.com/speech_address_to_the_universities_australia_conference_canberra_thursday_28_february_2019">demand-driven funding</a>, which existed between 2012 and 2017, where universities are paid for every student studying and there is no limit on the number of students that can be admitted to courses. <a href="https://theconversation.com/labor-wants-to-restore-demand-driven-funding-to-universities-what-does-this-mean-116060">Evidence suggests</a> this has been effective in boosting studies in areas where there are skills shortages, such as health, and also appears to have improved access to education for disadvantaged groups. </p>
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Read more:
<a href="https://theconversation.com/demand-driven-funding-for-universities-is-frozen-what-does-this-mean-and-should-the-policy-be-restored-116060">Demand-driven funding for universities is frozen. What does this mean and should the policy be restored?</a>
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<p>Due to costs, the Coalition has moved to a <a href="https://www.smh.com.au/opinion/bold-and-successful-experiment-comes-to-premature-end-with-22-billion-university-funding-cut-20171220-h07tfa.html">funding model based on population</a> and <a href="https://docs.education.gov.au/node/52006">university performance</a>. It has also promised <a href="https://www.liberal.org.au/our-plan-quality-education">extra support</a> for regional students and universities. This could help address the <a href="https://research.acer.edu.au/cgi/viewcontent.cgi?article=1228&context=research_conference">large gaps</a> in university participation between young people from major cities, and rural and regional Australia.</p>
<h2>Making an informed choice</h2>
<p>When casting our votes, we would do well to look past the dollar signs, and think about how each party is shaping an education system that will deliver quality learning for all Australians, from all kinds of backgrounds, from childhood through to adulthood.</p>
<p>The Coalition has delivered needs-based funding for schools and promises a greater focus on regional and rural students in all sectors. But there are some apparent gaps in early learning and tertiary policy and funding.</p>
<p>Labor has pledged more funding in all sectors. It has made a prominent commitment to early childhood education and care. However, <a href="https://theconversation.com/compare-the-pair-key-policy-offerings-from-labor-and-the-coalition-in-the-2019-federal-election-116898">Labor’s policies are expensive</a> and would need to be implemented effectively to make sure they achieve the intended outcomes for students and deliver the <a href="http://www.mitchellinstitute.org.au/reports/costs-of-lost-opportunity/">financial benefit to the economy</a> in the long-term.</p>
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Read more:
<a href="https://theconversation.com/compare-the-pair-key-policy-offerings-from-labor-and-the-coalition-in-the-2019-federal-election-116898">Compare the pair: key policy offerings from Labor and the Coalition in the 2019 federal election</a>
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<p class="fine-print"><em><span>Kate Noble does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>If you’re confused about all the millions and billions thrown around for education by the two major parties, here’s the low-down on what the policies actually mean.Kate Noble, Education Policy Fellow, Mitchell Institute, Victoria UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1160602019-05-01T20:17:25Z2019-05-01T20:17:25ZDemand-driven funding for universities is frozen. What does this mean and should the policy be restored?<figure><img src="https://images.theconversation.com/files/271921/original/file-20190501-142973-eba0i5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">A demand-driven funding model increased enrolments dramatically.</span> <span class="attribution"><span class="source">from shutterstock.com</span></span></figcaption></figure><p>Labor says it will <a href="http://www.tanyaplibersek.com/speech_address_to_the_universities_australia_conference_canberra_thursday_28_february_2019">bring back demand-driven funding</a> for universities if it wins this month’s election. Put simply, this means instead of the government providing each university with a fixed sum of money for teaching (which is what happens now), it would instead provide funds based on how many students have actually enrolled. </p>
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<p>The Australian government operated a demand-driven funding system for public universities between 2012 and 2017. During these years, universities could enrol unlimited numbers of bachelor-degree students into any discipline other than medicine and be paid for every one of them. </p>
<p>Although universities did not have to meet demand from prospective students, they had much more freedom to do so. Moving to a demand-driven system is also referred to as scrapping the “cap” on government funding of university places.</p>
<p>Labor’s policy wouldn’t only give universities a funding boost, it would help universities adapt to and plan for future needs. Here’s what happened last time demand-driven funding was introduced, and why the policy changed.</p>
<h2>What’s supply-driven, or block-grant funding?</h2>
<p>Until 2012, the Commonwealth government had a <em>supply-driven</em> policy, also known as a <em>block-grant</em> system. This is because the government would decide on a block amount of funding it would provide to universities, and how many places the universities would have to deliver. </p>
<p>The government then <a href="https://docs.education.gov.au/system/files/doc/other/hereport10.pdf">divided the places and money between universities</a>, which selected students based on the availability of places. The total number of places was always <a href="https://www.smh.com.au/national/one-in-10-miss-out-on-uni-places-20040430-gdiu3m.html">below demand</a>.</p>
<p>Aside from limiting entry to university, the old block-grant system was criticised for being too bureaucratic and inflexible. In a much-quoted phrase, <a href="https://fbe.unimelb.edu.au/__data/assets/pdf_file/0006/775221/Australian_Universities_Moscow_on_the_Molonglo.pdf">the economist Max Corden described it</a> as “Moscow on the Molonglo” – a reference to <a href="https://en.wikipedia.org/wiki/Soviet-type_economic_planning">Soviet-era central planning</a> and a <a href="https://en.wikipedia.org/wiki/Molonglo_River">river in Canberra</a>. </p>
<p>In most years, numbers of places allocated to universities were similar to the year before. This was the case regardless of student preferences, labour market trends, or a university’s strategy or performance. </p>
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<a href="https://theconversation.com/how-has-education-policy-changed-under-the-coalition-government-113921">How has education policy changed under the Coalition government?</a>
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<p>The supply-driven policy’s limit on student places <em>was</em> a major constraint, but otherwise the system was only moderately prescriptive. There were some controls, such as limits on medical students. But generally universities could distribute their block funding between courses according to their own priorities. </p>
<p>A <a href="https://www.education.gov.au/commonwealth-grant-scheme-cgs">version of this block-grant system</a> has continuously been used for government-funded diploma, associate degree and postgraduate student places. But fixed student-place allocations and money for bachelor-degree students were abolished for a demand-driven system in 2012.</p>
<h2>Why was demand-driven funding introduced?</h2>
<p>The 2008 <a href="https://www.voced.edu.au/content/ngv%3A32134">Bradley higher education policy review</a> recommended demand-driven funding. Julia Gillard announced the policy in <a href="http://www.abc.net.au/pm/content/2008/s2569686.htm">2009 when she was education minister</a>, and it was phased in while she was prime minister. </p>
<p>The Bradley report argued a demand-driven system would let universities adapt more readily to student and labour-market needs. The <a href="https://www.voced.edu.au/content/ngv%3A14895">government agreed</a>, saying it wanted to move away from “dictating and rationing the supply of university places”.</p>
<p>One <a href="https://web.archive.org/web/20100305075307/http://www.deewr.gov.au/HigherEducation/Pages/TransformingAustraliasHESystem.aspx">major reason the government gave</a> for introducing demand-driven funding was to increase higher education participation and attainment rates. The government set a target of 40% of all 25-34-year-olds to have a bachelor degree by 2025, up from 32% at the time. </p>
<p>Without previous controls on student numbers the higher education system entered a transformational phase. Three universities – <a href="https://www.acu.edu.au/">Australian Catholic University</a>, <a href="https://www.swinburne.edu.au/">Swinburne</a> and <a href="https://www.usc.edu.au/">Sunshine Coast</a> – <a href="http://highereducationstatistics.education.gov.au/">more than doubled</a> their domestic bachelor-degree enrolments between 2008 and 2017. Another six increased their enrolments by more than half. </p>
<p>Domestic student bachelor-degree enrolments in 2017 <a href="https://grattan.edu.au/wp-content/uploads/2018/01/demand_driven_facts_figures_SLNSW_13Feb.pdf">were up by 45% from 2008</a>, reaching nearly one-quarter of a million. </p>
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<p>This enrolment growth put us on track to meet the original 40% attainment target. In 2017, nearly <a href="https://twitter.com/andrewjnorton/status/1108240201795563520">42% of 19-year-olds</a> were enrolled in higher education, up more than 10 percentage points from 2008.</p>
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<p>The government particularly wanted more students from disadvantaged backgrounds. The official equity statistics are based on geographic measures that provide only a rough guide to progress, although <a href="https://docs.education.gov.au/node/51496">they show some</a>, with students from areas of low socioeconomic status increasing from 16% to 19% of undergraduate enrolments. </p>
<p>A <a href="https://grattan.edu.au/report/mapping-australian-higher-education-2018/">Grattan Institute analysis</a> found that, in 2016, 25% of children of machinery operators, drivers and labourers were at university or already had a degree in their early 20s. That was up 9 percentage points from the decade before, but still well below the rate (61%) of children of managers and professionals. </p>
<p>In line with Bradley’s hopes, enrolments rose in courses teaching areas of <a href="https://docs.jobs.gov.au/documents/historical-list-skill-shortages-australia-0">skills shortage</a>, such as engineering and health. Health courses expanded the most – up by 73% in 2017 from 2008. </p>
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Read more:
<a href="https://theconversation.com/many-australian-universities-may-be-in-surplus-but-does-that-mean-theres-fat-to-cut-77244">Many Australian universities may be in surplus, but does that mean there's fat to cut?</a>
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<p>Although demand-driven funding met employer needs, graduates did not do so well. Increased course completions <a href="https://theconversation.com/graduate-employment-is-up-but-finding-a-job-can-still-take-a-while-109654">coincided with an end-of-the-mining boom crash</a> in jobs for young graduates. And 2014 was the worst year ever for recent graduate employment, with a third of those looking for full-time work unable to find it four months after finishing their course. </p>
<p>Job numbers have since fully recovered, but recent graduate full-time employment rates remain below their historical average. But this wasn’t why the government scrapped the demand-driven model in December 2017.</p>
<h2>Why did it end?</h2>
<p>The policy ended because of cost. By 2017, demand-driven funding had caused spending to increase by <a href="https://grattan.edu.au/report/commonwealth-orange-book-2019/">more than 50% in real terms</a> since 2008. From <a href="https://parlinfo.aph.gov.au/parlInfo/download/media/pressrel/2373570/upload_binary/2373570.pdf;fileType=application/pdf#search=%22media/pressrel/2373570%22">2013</a> to <a href="https://docs.education.gov.au/system/files/doc/other/ed17-0138_-_he_-_glossy_budget_report_acc.pdf">2017</a>, every federal budget included an attempt to curb higher education spending, while keeping the demand-driven system. </p>
<p>But when the last of these attempts failed in the Senate in late 2017, the Coalition government <a href="https://www.smh.com.au/opinion/bold-and-successful-experiment-comes-to-premature-end-with-22-billion-university-funding-cut-20171220-h07tfa.html">used a fiscal emergency provision</a> and froze bachelor-degree spending for two years, with population-linked adjustments from 2020 for universities that met certain <a href="https://docs.education.gov.au/node/52006">performance criteria</a>. </p>
<p>Effectively, this means we’re back to the block-grant system, except universities don’t have enrolment targets and <a href="https://grattan.edu.au/news/beware-performance-funding-schemes-for-teaching/">can decide to reduce student places</a>. </p>
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Read more:
<a href="https://theconversation.com/margaret-gardner-freezing-university-funding-is-out-of-step-with-the-views-of-most-australians-92570">Margaret Gardner: freezing university funding is out of step with the views of most Australians</a>
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<p>In the short term, the freeze shouldn’t affect students too much. Demand has been <a href="https://www.education.gov.au/undergraduate-applications-offers-and-acceptances-publications">soft since 2015 and fell in 2018</a>, mainly because <a href="https://andrewnorton.net.au/2019/03/18/why-is-mature-age-university-demand-trending-down/">fewer older people wanted to study</a>. <a href="https://www.uac.edu.au/media-centre/statistics/domestic-undergraduate-applications-and-offers-at-semester-1-closing-2019">Early indications</a> are that demand fell again in 2019. </p>
<p>Over the medium to long run, however, current policies would cause significant problems. In the mid-2020s, <a href="https://andrewnorton.net.au/2019/04/29/young-people-were-less-likely-to-enter-higher-education-in-the-years-after-whitlam-than-before-demography-and-deficits-were-against-them/">Australia’s school-leaver population</a> will be larger than at any time in our history. And a shrinking higher education system would be unable to meet their educational needs.</p>
<p>Demand-driven funding is not just about total student numbers. Even when total domestic enrolments are going down, as they might be now, demand for some specific courses and universities will be going up. The capacity of demand-driven funding to manage these micro-level changes, as well as bigger population trends, make it superior to a block-grant system.</p><img src="https://counter.theconversation.com/content/116060/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Andrew Norton co-authored a government review of the demand driven system in 2014. </span></em></p>Labor’s main election promise for higher education is to restore the demand-driven system of funding, also known as scrapping the “cap” on government funding. Here’s why that would be a good policy.Andrew Norton, Honorary fellow, The University of MelbourneLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1144342019-04-10T04:50:22Z2019-04-10T04:50:22ZArts and culture under the Coalition: a lurch between aggression and apathy<p>This article is part of a <a href="https://theconversation.com/au/topics/coalition-record-2019-69102">series</a> examining the Coalition government’s record on key issues while in power and what Labor is promising if it wins the 2019 federal election.</p>
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<p>What happens when an opposition party wins power? In theory, it adopts a more statesmanlike demeanour. If it doesn’t, it stays perennially narky, unwilling to accept others’ ideas, yet incapable of generating a positive way forward itself. </p>
<p>The alternate aggression and apathy of the Coalition in arts and culture since the 2013 election suggests it never abandoned its oppositional ways. Taking office just after <a href="https://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/FlagPost/2013/April/Creative_Australia__National_Cultural_Policy_2013">Creative Australia</a>, the national cultural policy Labor released too late to have much practical effect, the way was clear to reclaim the portfolio as one of bipartisan concern.</p>
<p>This had happened under Prime Minister John Howard, who responded to the game-changing influence of Paul Keating’s <a href="https://apo.org.au/node/29704">Creative Nation</a> policy not by rejecting it, but by extruding its ambitions through traditional Menzies values. </p>
<p>Instead, the last six years has seen a combination of ministerial whim and purposeless economising. There has been an absence of strong policy initiatives, neglect of smaller arts organisations, and an undermining of trust in arm’s length agencies, notably the Australia Council for the Arts and the ABC.</p>
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Read more:
<a href="https://theconversation.com/australian-governments-have-a-long-history-of-trying-to-manipulate-the-abc-and-its-unlikely-to-stop-now-110712">Australian governments have a long history of trying to manipulate the ABC – and it's unlikely to stop now</a>
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<p>The first Coalition arts minister, George Brandis, was an artistic conservative with a poor grasp of the sector’s industrial complexities. Mitch Fifield, the current minister, is an economic conservative with little time for its cultural complexities. The emergence of tech giants like Netflix and Amazon has changed the landscape of the arts, introducing a proliferation of new competitors for Australian creators – but the government has failed to keep up with these developments.</p>
<p>There has also been a resurgent populist politics with a nasty, xenophobic edge to it. As a mechanism for social inclusion, arts and culture appear to have passed the Coalition by entirely.</p>
<h2>A space where nothing happens</h2>
<p>All the government’s major cultural policy events have been regrettable ones: the spat over the 2014 Sydney Biennale, which saw Brandis <a href="https://www.theguardian.com/world/2014/mar/13/george-brandis-threatens-sydney-biennale-transfield-blackballing">threaten artists if they <em>didn’t</em> accept corporate sponsorship</a>; the 2015 raid on the Australia Council’s budget to establish an ill-defined <a href="https://www.theaustralian.com.au/nation/politics/budget-2015-national-programme-for-excellence-in-the-arts-established/news-story/b460206e1744de45f93fba6c0846e50c">National Programme for Excellence in the Arts</a> (NPEA); and a <a href="https://www.aph.gov.au/parliamentary_business/committees/senate/legal_and_constitutional_affairs/arts_funding">Senate Inquiry into the arts cuts</a> with an unprecedented 1,719 submissions.</p>
<p>Then, with the accession of Fifield as minister, the <a href="https://www.smh.com.au/entertainment/art-and-design/rebranding-npea-to-catalyst-the-same-program-by-another-name-20151120-gl3oqr.html">rebranding of the NPEA as the Catalyst Fund</a>, the <a href="https://theconversation.com/after-the-catalyst-arts-funding-mess-many-questions-remain-74848">dissolution of this body too</a>, and the return to the Australia Council of most (but not all) of the money taken from it 18 months previously.</p>
<p>Since 2016 arts and culture has been a space where nothing happens, by design. The low rate of government investment in the sector has continued unabated. In 2011-12, total federal cultural expenditure was <a href="https://www.abs.gov.au/ausstats/abs@.nsf/Lookup/4172.0main+features82014">A$2.355 billion; in 2012-13 A$2.361 billion</a>; <a href="https://www.arts.gov.au/sites/g/files/net1761/f/cultural-funding-by-government-data-2015-16.pdf">in 2015-16 A$2.29 billion</a>; and <a href="https://www.arts.gov.au/sites/g/files/net1761/f/cultural-funding-by-government-australia-2016-17-data.pdf">in 2016-17 it was A$2.384 billion</a>.</p>
<p>Figures for 2014-15 are hard to find, because in 2014 the Australian Bureau of Statistics <a href="http://www.abs.gov.au/ausstats/abs@.nsf/products/745695D9AEBEFE64CA257CEE0004715C?OpenDocument">canned its Culture, Sport and Recreation accounts</a> in response to funding cuts. The burden of collecting cultural data then fell on the <a href="https://www.arts.gov.au/documents/meeting-cultural-ministers-statistical-advisory-group-and-statistics-working-group-history">Meeting of Cultural Ministers Statistical Advisory Group</a> – which had its federal administrative support removed in 2012.</p>
<p>Against this, the Coalition can point to recent investment in cultural infrastructure through the <a href="https://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/rp/rp1718/Quick_Guides/Publicservice">Public Service Modernisation Fund</a>, and a <a href="https://www.arts.gov.au/departmental-news/budget-2017-18-arts">A$8.2 million tip-in</a> for collecting institutions. The <a href="https://www.ausleisure.com.au/news/federal-government-commits-63.8-million-to-canberras-national-gallery-of-australia/">National Gallery of Australia has received A$63.8 million</a> to ensure, in the words of one arts bureaucrat, “the new Director doesn’t have a leaky roof and can buy the next Blue Poles”. Given the <a href="https://www.finance.gov.au/resource-management/pgpa-glossary/efficiency-dividend/">Efficiency Dividends</a> scalped from galleries and museums in the past, however, this counts as little more than one step forward after two steps back.</p>
<p>The 2019 Coalition budget extends the ad hocism, with A$30.9 million for an <a href="https://www.minister.communications.gov.au/minister/mitch-fifield/news/more-live-music-more-opportunities-australias-musicians">Australian Music Industry Package</a>, and sprinkled support for select cultural bodies, including the <a href="https://bundanon.com.au">Bundanon Trust</a>, the property Arthur Boyd bequeathed to the nation (that just happens to be in the Liberals’ <a href="https://insidestory.org.au/for-whom-a-bellwether-tolls/">most marginal NSW seat</a>).</p>
<p>There is no return of money to the Australia Council or the Regional Arts Fund. In the words of Artshub’s Richard Watts the budget “<a href="https://www.artshub.com.au/news-article/news/grants-and-funding/richard-watts/what-the-arts-got-from-budget-2019-257671">demonstrates the Morrison government’s lack of interest and understanding of the sector</a>”.</p>
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<a href="https://theconversation.com/missing-in-action-a-vision-for-the-arts-in-the-2019-budget-114816">Missing in action: a vision for the arts in the 2019 budget</a>
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<p>Most serious of all has been the damage done to the reputation and operation of the Australia Council and the ABC. Intentionally or not, both were harmed under the Coalition. Given their crucial role as protectors of our national culture, the consequences go beyond the immediate storms in which they were embroiled.</p>
<h2>Labor’s challenge</h2>
<p>The main challenge facing an incoming Labor government is recognised in its pre-election manifesto <a href="https://www.alp.org.au/media/1539/2018_alp_national_platform_constitution.pdf">A Fair Go for Australia</a>: which parts of creative Australia remain applicable and which need upgrading? The arts and culture section juggles two sets of priorities. On the one hand, there is standard blah about “contribut[ing] to innovation and lift[ing] productivity”. On the other, there is new awareness of the urgent need to promote cultural diversity and connection in an age of democracy deficit. </p>
<p>These pronouncements are of the broader kind. Yet there are two specifics Labor might consider. First, ending efficiency dividends for arts and culture, which are not efficient and a dividend only if the public goods so targeted are not impaired. </p>
<p>Second, restoring federal support for the Statistical Advisory Group and the ABS’s Culture, Sport and Recreation accounts. I have been an <a href="http://www.publishing.monash.edu/books/wm-9781925523805.html">outspoken critic of the datafication of cultural policy</a>, but fit-for-purpose facts and figures are essential to meaningful evaluation. </p>
<p>Both resources are important for ensuring our next national cultural policy is truly cultural, national and bipartisan.</p><img src="https://counter.theconversation.com/content/114434/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Julian Meyrick does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The Coalition government’s approach to arts and culture policy has been one of ad hocism and neglect. Perhaps most serious has been the damage done to the Australia Council and the ABC.Julian Meyrick, Professor of Creative Arts, Flinders UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1089092018-12-18T03:58:09Z2018-12-18T03:58:09ZLabor’s housing pledge is welcome, but direct investment in social housing would improve it<p>Despite recent falls in the housing market, housing costs and indebtedness bite deeply into household budgets, especially at Christmas time. Just over <a href="https://www.ahuri.edu.au/research/final-reports/306">433,000 households</a> confront housing stress and homelessness every day across Australia. They represent the current shortfall of <a href="https://housing.vic.gov.au/social-housing">social housing</a>. </p>
<p>If Christmas offers a moment for reflection, ask yourself what should our resolutions be for the housing market? What should we expect our governments to do about it?</p>
<p>In this article, we look at this week’s major statement on housing policy from a key contender to lead Australia’s next government – <a href="https://theconversation.com/shortens-subsidy-plan-to-boost-affordable-housing-108881">made by Bill Shorten</a> at the ALP national conference. </p>
<p>We applaud the principle of fairness and the ambition of the ALP policy. We are less supportive of the reliance on for-profit investors, market rent mechanisms and land grabs. <a href="https://www.ahuri.edu.au/research/final-reports/306">Our research</a> shows direct government investment in social housing is ultimately far <a href="https://theconversation.com/australia-needs-to-triple-its-social-housing-by-2036-this-is-the-best-way-to-do-it-105960">more efficient and effective</a> than subsidising investors in the long term.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/australia-needs-to-triple-its-social-housing-by-2036-this-is-the-best-way-to-do-it-105960">Australia needs to triple its social housing by 2036. This is the best way to do it</a>
</strong>
</em>
</p>
<hr>
<h2>So what is Labor’s policy?</h2>
<p>Shorten’s announcement also pledges reform of tax concessions that are driving inequality between households and investors. However, Labor recognises that this might not be enough to tilt the balance in favour of low-income households, and directing the savings from these changes into housing programs is a welcome move. </p>
<p>Labor proposes to subsidise investors in affordable rental housing, much like the Rudd government’s National Rental Affordability Scheme (<a href="https://www.dss.gov.au/housing-support-programs-services-housing-national-rental-affordability-scheme/about-the-national-rental-affordability-scheme-nras">NRAS</a>). Labor would offer an $8,500-a-year subsidy over 15 years to investors who build new homes for low-income and middle-income households to rent at an “affordable” rate – 20% below market rent. </p>
<p>Starting modestly, the program aims to produce 20,000 affordable units over three years, building to a much larger target of 250,000 dwellings over ten years. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/shortens-subsidy-plan-to-boost-affordable-housing-108881">Shorten's subsidy plan to boost affordable housing</a>
</strong>
</em>
</p>
<hr>
<p>State governments would also be required to get on board through partnership agreements, as they have done in the past, providing land and other forms of co-investment. <a href="https://www.domain.com.au/news/stamp-duty-across-australia-doubled-in-past-four-years-according-to-housing-industry-association-20180116-h0j6yb/">Hefty stamp duty revenues</a> in recent years should make this easier for the states.</p>
<p>While Labor’s targets appear high by recent standards, Commonwealth and state governments directly funded the building of 9,000 public housing dwellings each year for the better half of the 20th century – until 1996. Annual production is now down to 3,000 dwellings. That’s not even enough to maintain the existing public share of housing.</p>
<p>Since the mid-1990s, a preference for outsourcing social responsibility through private rental providers and indirect rental support payments has dominated public policy. The ALP’s subsidy-based policy continues this trend. </p>
<p>The proposal centres on maintaining returns to investors at levels that encourage investment. As our previous <a href="https://www.ahuri.edu.au/research/final-reports/306">research</a> has shown, over the longer term this increases cost per dwelling. The question remains, as it did under the NRAS: <a href="https://www.domain.com.au/news/labors-new-build-to-rent-housing-subsidy-labelled-a-handout-for-developers-792720/">who are we trying to subsidise here</a>, the investors or the tenants, and is it really equitable and effective? </p>
<h2>What are the alternatives?</h2>
<p><a href="https://www.ahuri.edu.au/research/final-reports/293">Previous work has shown</a> that NRAS-type schemes offer most benefit to new affordable housing developments when the funds are directed to not for profit organisations, rather than “leaking” out to the for-profit private sector. The advantages of this approach include:</p>
<ul>
<li>subsidies are retained within the affordable housing system</li>
<li>benefits are directed to regulated not-for-profit developers with a social purpose </li>
<li>the benefit is stretched out over a longer time, meaning government investment does not expire after a set time.</li>
</ul>
<p>In the UK, a lack of direct conditional investment and weak definitions of affordability led to an <a href="https://www.theguardian.com/society/2018/nov/22/construction-of-homes-for-social-rent-down-80-percent-on-a-decade-ago-england-families-waiting-lists?CMP=Share_iOSApp_Other">80% decline in social housing production</a>. Without public equity, recurrent operating subsidies have no influence on design quality or ongoing impact after the expiry of providers’ obligations – or their cancellation. Yes, they can be switched on and off like a tap – as <a href="https://www.propertyobserver.com.au/forward-planning/investment-strategy/politics-and-policy/31235-no-future-for-nras-as-fifth-round-is-scrapped-in-2014-budget.html">happened in 2014 with the NRAS</a>.</p>
<p>With good design, a new scheme could overcome some of these deficiencies. Labor promises to provide lower annual subsidies than NRAS but for longer – 15 rather than 10 years – adding up to at least $127,500 from the Commonwealth for a tenancy to be offered at below market rents. It’s a substantial commitment. </p>
<p>Yet if this level of support was invested up front to build dwellings, rather than provided as an annual operating subsidy, it would make a substantial and enduring contribution to Australia’s housing needs. This is not only socially responsible, it can drive green innovation and is also more financially responsible too.</p>
<p>The only thing that stands in the way is the narrow public accounting doctrine that privileges day-to-day expenditure over long-term investments. This is something that, in the UK, even the Treasury and the National Audit Office are learning to overcome after the painful experience of the <a href="https://www.theguardian.com/uk-news/2018/oct/29/hammond-abolishes-pfi-contracts-for-new-infrastructure-projects">Private Finance Initiative</a>.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/homeless-numbers-will-keep-rising-until-governments-change-course-on-housing-93417">Homeless numbers will keep rising until governments change course on housing</a>
</strong>
</em>
</p>
<hr>
<h2>How much more cost-effective is direct investment?</h2>
<p>If equity and fairness are to be the yardsticks of policy, age pensioners, people with disabilities and low-paid workers should be the focus of our deepest support. Our <a href="https://www.ahuri.edu.au/research/final-reports/306">AHURI research</a> has established the level, type and location of investment required to meet the needs of 433,000 low-income households in housing stress or homeless across Australia. The current market offers no affordable or secure options for them. </p>
<p><a href="https://www.ahuri.edu.au/research/final-reports/306">Our research</a> also compared the cost of subsidising investors versus direct investment by government. Our modelling of costs and review of international experience provide evidence that direct investment is far more efficient and effective in the medium and long term.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/251078/original/file-20181217-185264-ezojzz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/251078/original/file-20181217-185264-ezojzz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=413&fit=crop&dpr=1 600w, https://images.theconversation.com/files/251078/original/file-20181217-185264-ezojzz.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=413&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/251078/original/file-20181217-185264-ezojzz.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=413&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/251078/original/file-20181217-185264-ezojzz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=518&fit=crop&dpr=1 754w, https://images.theconversation.com/files/251078/original/file-20181217-185264-ezojzz.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=518&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/251078/original/file-20181217-185264-ezojzz.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=518&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Capital funding model.</span>
<span class="attribution"><a class="source" href="https://www.ahuri.edu.au/research/final-reports/306">Lawson et al, 2018</a>, <span class="license">Author provided</span></span>
</figcaption>
</figure>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/251077/original/file-20181217-185249-13gdkq7.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/251077/original/file-20181217-185249-13gdkq7.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=346&fit=crop&dpr=1 600w, https://images.theconversation.com/files/251077/original/file-20181217-185249-13gdkq7.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=346&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/251077/original/file-20181217-185249-13gdkq7.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=346&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/251077/original/file-20181217-185249-13gdkq7.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=435&fit=crop&dpr=1 754w, https://images.theconversation.com/files/251077/original/file-20181217-185249-13gdkq7.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=435&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/251077/original/file-20181217-185249-13gdkq7.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=435&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Operating subsidy funding model.</span>
<span class="attribution"><a class="source" href="https://www.ahuri.edu.au/research/final-reports/306">Lawson et al, 2018</a>, <span class="license">Author provided</span></span>
</figcaption>
</figure>
<p>Thus, we argue for more direct investment in social housing, strategic use of efficient mission-driven financing and retained investment via public equity and public land leases.</p>
<p>Recognition of the need for national leadership and policy reform is growing. After backpedalling, the Coalition government moved forward in 2018 to establish, with cross-party support, the <a href="https://nhfic.gov.au/about-us/">National Housing Finance Corporation</a>. This mission focused public corporation will soon channel lower-cost financing towards regulated not-for-profit housing. Of course, financing is debt and not quite the same as funding. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/government-guarantee-opens-investment-highway-to-affordable-housing-88549">Government guarantee opens investment highway to affordable housing</a>
</strong>
</em>
</p>
<hr>
<p>The Australian Greens have yet to announce their policy but an outline suggests a commitment to invest in social housing and establish a federal housing trust. </p>
<p>The ALP’s proposals are framed in line with the laudable principle of fairness and are a work in progress – rather than mission accomplished. Overcoming the shortfall of affordable and secure housing will require purposeful Commonwealth and state government funding, mission driven financing as well as land policies to make housing markets fairer for all.</p><img src="https://counter.theconversation.com/content/108909/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Julie Lawson receives funding from the Australian Housing and Urban Research Institute. </span></em></p><p class="fine-print"><em><span>Laurence Troy receives funding from the Australian Housing and Urban Research Institute and the Australian Research Council. </span></em></p>Labor has made a substantial commitment to tackling inequality in Australia, but has taken a second-best approach to overcoming the huge shortfall of social housing.Julie Lawson, Honorary Associate Professor, Centre for Urban Research, RMIT UniversityLaurence Troy, Research Fellow, City Futures Research Centre, UNSW SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/935942018-03-26T03:40:36Z2018-03-26T03:40:36ZFactCheck Q&A: are South Australia’s high electricity prices ‘the consequence’ of renewable energy policy?<figure><img src="https://images.theconversation.com/files/211112/original/file-20180320-31602-918p7m.JPG?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Minister for Urban Infrastructure and Cities Paul Fletcher, speaking on Q&A.</span> <span class="attribution"><span class="source">ABC Q&A</span></span></figcaption></figure><p><strong>The Conversation fact-checks claims made on Q&A, broadcast Mondays on the ABC at 9.35pm. Thank you to everyone who sent us quotes for checking via <a href="http://www.twitter.com/conversationEDU">Twitter</a> using hashtags #FactCheck and #QandA, on <a href="http://www.facebook.com/conversationEDU">Facebook</a> or by <a href="mailto:checkit@theconversation.edu.au">email</a>.</strong></p>
<hr>
<figure>
<iframe width="440" height="260" src="https://www.youtube.com/embed/9JRkHDUAAH0?wmode=transparent&start=0" frameborder="0" allowfullscreen=""></iframe>
<figcaption><span class="caption">Excerpt from Q&A, March 19, 2018.</span></figcaption>
</figure>
<blockquote>
<p>Now, the consequence of [Jay Weatherill’s] policies was that South Australians faced the highest electricity charges, the highest retail electricity charges, in the country.</p>
<p><strong>– Minister for Urban Infrastructure and Cities Paul Fletcher, <a href="https://youtu.be/9JRkHDUAAH0">speaking on Q&A</a>, March 19, 2018</strong></p>
</blockquote>
<p>During an <a href="http://www.abc.net.au/tv/qanda/txt/s4805964.htm">episode of Q&A</a>, Minister for Urban Infrastructure and Cities Paul Fletcher said that South Australia has the “highest retail electricity charges in the country”. That statement in itself <a href="https://theconversation.com/factcheck-does-south-australia-have-the-highest-energy-prices-in-the-nation-and-the-least-reliable-grid-92928">is correct</a>.</p>
<p>But Fletcher went on to say that the high prices were “the consequence” of former SA Premier Jay Weatherill’s renewable energy policies, which included the introduction of a 50% renewable energy target, <a href="http://www.abc.net.au/news/2017-04-10/south-australia-renewable-energy-target-reached-early/8429722">met in 2017</a>.</p>
<p>Was Fletcher right?</p>
<h2>Checking the source</h2>
<p>In response to a request for sources and comment, a spokesperson for Fletcher pointed The Conversation to the Australian Energy Market Commission’s 2017 Residential Electricity Price Trends <a href="https://www.aemc.gov.au/markets-reviews-advice/2017-residential-electricity-price-trends">report</a>, wholesale electricity price data from the Australian Energy Market Operator, and a 2017 Australian Competition and Consumer Commission <a href="https://www.accc.gov.au/system/files/Retail%20Electricity%20Inquiry%20-%20Preliminary%20report%20-%2013%20November%202017.pdf">report</a>, which stated that: </p>
<blockquote>
<p>… the combination of significant network investment over the past decade, recent increases to gas prices, more concentrated wholesale markets, and the transition from large scale synchronous generation to variable and intermittent renewable energy resources has had a more pronounced effect on retail prices and number of offers in South Australia than any other state in the National Electricity Market.</p>
</blockquote>
<p>You can read the full response from Fletcher’s office <a href="https://theconversation.com/full-response-from-a-spokesperson-for-paul-fletcher-for-a-factcheck-on-electricity-prices-and-renewable-energy-93662">here</a>.</p>
<hr>
<h2>Verdict</h2>
<p>Paul Fletcher was correct to say that South Australia has the highest retail electricity prices in Australia.</p>
<p>Current prices for the typical South Australian customer are 37.79 cents per kilowatt-hour (c/kWh). The Australian Capital Territory has the lowest retail electricity prices in Australia, at around 23.68 c/kWh.</p>
<p>But there are many factors that affect retail electricity prices. Increasing levels of renewable energy generation is just one.</p>
<p>Other factors include network costs, gas prices, changes in supply and demand dynamics and market competition issues.</p>
<p>Therefore, Fletcher’s assertion that South Australia’s high retail electricity prices are “the consequence” of former Premier Jay Weatherill’s renewable energy policies is incorrect.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/factcheck-does-south-australia-have-the-highest-energy-prices-in-the-nation-and-the-least-reliable-grid-92928">FactCheck: does South Australia have the 'highest energy prices' in the nation and 'the least reliable grid'?</a>
</strong>
</em>
</p>
<hr>
<h2>Does South Australia have the highest retail electricity prices in the nation?</h2>
<p>First, a quick terminology reminder. “Energy” is a broad term that includes sources such as petrol, diesel, gas and renewables, among other things. “Electricity” is a specific form of energy that can be produced from many different sources.</p>
<p>The “retail electricity price” is what you’ll typically see in your home electricity bill, and is usually expressed in cents per kilowatt-hour (c/kWh). </p>
<p>According the Australian Energy Market <a href="https://www.aemc.gov.au/markets-reviews-advice/2017-residential-electricity-price-trends">2017 Residential Electricity Price Trends</a> report, South Australia does indeed have the highest retail prices in the nation. Current prices for the typical South Australian customer are 37.79c/kWh.</p>
<p>The lowest retail electricity prices in the country are in the Australian Capital Territory, where the typical customer pays around 23.68c/kWh. </p>
<hr>
<p><iframe id="1BYc9" class="tc-infographic-datawrapper" src="https://datawrapper.dwcdn.net/1BYc9/3/" height="400px" width="100%" style="border: none" frameborder="0"></iframe></p>
<hr>
<p>The retail electricity price includes the wholesale price of the electricity, the network costs (or the “poles and wires” that bring the electricity to your home), retailing costs, and levies related to “green schemes” (such as the renewable energy target or solar feed-in tariffs). </p>
<p>The chart below shows how the different components contributed the electricity price increase in South Australia between 2007-08 and 2015-16.</p>
<hr>
<iframe src="https://datawrapper.dwcdn.net/NujQW/6/" scrolling="no" frameborder="0" allowtransparency="true" width="100%" height="450"></iframe>
<hr>
<p>For many years the drivers for retail prices have been network costs – which have very little to do with renewables.</p>
<p>But over the past 18 months, there has also been a increase in <em>wholesale</em> electricity prices across the entire National Electricity Market – the interconnected power system that covers Queensland, New South Wales, the Australian Capital Territory, Victoria, South Australia and Tasmania.</p>
<p>A range of factors have contributed to this.</p>
<p>These include the increase in gas prices, and the tightening of the supply-demand balance.</p>
<p>The closures of South Australia’s <a href="https://en.wikipedia.org/wiki/Northern_Power_Station_(South_Australia)">Northern Power Station</a> in 2016 and Victoria’s <a href="https://en.wikipedia.org/wiki/Hazelwood_Power_Station">Hazelwood Power Station</a> have contributed to a reduction in electricity supply (capacity).</p>
<p>The ACCC is also <a href="https://www.accc.gov.au/system/files/Retail%20Electricity%20Inquiry%20-%20Preliminary%20report%20-%2013%20November%202017.pdf">investigating</a> “transfer pricing” – which is when a business that’s an energy generator as well as a retailer shifts costs from one part of its business to another. </p>
<h2>Are the prices ‘the consequence’ of Weatherill’s renewable energy policy?</h2>
<p>No. Even if wholesale prices become the main driver of retail prices, it’s not accurate to place the blame squarely on renewables. </p>
<p>Increased renewable energy generation may have contributed to decisions for some power plants to close. But so would other factors – such the <a href="http://www.abc.net.au/news/2016-12-01/worksafe-notices-detail-extent-of-repairs-needed-at-hazelwood/8082318">A$400 million safety upgrade</a> required for the Hazelwood power plant to have stayed open.</p>
<p>As mentioned above, other factors such as gas prices and competition issues have also contributed to increases in wholesale electricity prices. And as shown below, these are not confined to South Australia.</p>
<hr>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/210029/original/file-20180313-30979-jg4ezc.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/210029/original/file-20180313-30979-jg4ezc.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=377&fit=crop&dpr=1 600w, https://images.theconversation.com/files/210029/original/file-20180313-30979-jg4ezc.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=377&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/210029/original/file-20180313-30979-jg4ezc.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=377&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/210029/original/file-20180313-30979-jg4ezc.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=473&fit=crop&dpr=1 754w, https://images.theconversation.com/files/210029/original/file-20180313-30979-jg4ezc.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=473&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/210029/original/file-20180313-30979-jg4ezc.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=473&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Electricity futures prices for 2017–18.</span>
<span class="attribution"><span class="source">ACCC 2017, Retail Electricity Pricing
Inquiry, Preliminary report (page 56)</span></span>
</figcaption>
</figure>
<hr>
<p>Gas prices are particularly important in the South Australian context, which is the most gas-dependent region in the National Electricity Market. </p>
<p>In addition, the South Australian market is the <a href="https://www.aer.gov.au/publications/state-of-the-energy-market-reports/state-of-the-energy-market-may-2017">most concentrated in terms of competition</a>.</p>
<p>So, Fletcher was not correct to say that South Australia’s high electricity prices are “the consequence” of Weatherill’s renewable energy policies. </p>
<p>Indeed, a large proportion of the existing renewable investment in South Australia has been financed as a result of the federal Renewable Energy Target, introduced by the Howard government, rather than state policy. <strong>– Dylan McConnell</strong></p>
<hr>
<h2>Blind review</h2>
<p>I agree with the verdict.</p>
<p>The price question is not contentious. South Australia has the highest retail electricity prices in Australia.</p>
<p>But no single factor or decision is responsible for the electricity prices we endure today.</p>
<p>The prices are the result of <a href="https://theconversation.com/a-high-price-for-policy-failure-the-ten-year-story-of-spiralling-electricity-bills-89450">many different policies and pressures</a> at every step of the electricity supply chain. <strong>– David Blowers</strong></p>
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<p class="fine-print"><em><span>Dylan McConnell has received funding from the AEMC's Consumer Advocacy Panel and Energy Consumers Australia.</span></em></p><p class="fine-print"><em><span>David Blowers does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>On Q&A, Minister for Urban Infrastructure and Cities Paul Fletcher said South Australia’s high electricity prices were “the consequence” of Jay Weatherill’s renewable energy policies. Is that right?Dylan McConnell, Researcher at the Australian German Climate and Energy College, The University of MelbourneLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/703812017-05-10T01:34:21Z2017-05-10T01:34:21ZWill Trump give working families a break?<figure><img src="https://images.theconversation.com/files/168132/original/file-20170505-19145-1dgcr43.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Families benefit when fathers and mothers get paid parental leave.</span> <span class="attribution"><a class="source" href="https://www.flickr.com/photos/barretthall/3469064980/in/photolist-6hxSab-79vjrz-c7Mki7-8fMUN3-8fJENc-fGCAkj-29kbuV-8qeQ2f-c3oc5y-kWePq3-3ia1Y-8PCwt2-eS8tBj-7xDV-c3or9L-9NzGHk-dqxZsc-6Jzq5p-TMP61S-dVJHxm-57YAz2-ktVpoC-c3nXYb-asSvV-8Z21eZ-8Z21QD-mbqWmb-6fCcbx-8Z56cd-8dStd6-8Z55y7-8Z22Eg-6GD7fW-kcKSw1-egzd6o-bVsGJS-JKbV8w-9NADTg-9Nzvw2-9NsZV7-fkrsZ3-9NB42k-cC4Eaj-PVPT-8tkSt9-ju8T3E-6zHp33-gXerS-5csRjx-9NDHad">popofatticus/flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span></figcaption></figure><p>Federal Reserve Chair <a href="https://www.federalreserve.gov/newsevents/speech/yellen20170505a.htm">Janet Yellen</a> recently summed up the economic benefits of widespread child care and paid family leave. Since 1979, she explained in a speech at Brown University, women have brought about most gains in real household income. Making life easier for working moms helps women enter and stay in the workforce and in turn boosts economic growth, Yellen reasoned.</p>
<p>As an economics professor who researches issues that working women face, I couldn’t agree more. When more women earn income their own families benefit – along with the whole economy. And I’m heartened to see that after its initial proposal for a child care tax break that would mainly <a href="https://www.fastcompany.com/3068631/why-trumps-child-care-and-paid-leave-plan-are-fundamentally-flawed">benefit the rich</a>, the Trump administration has switched gears. It now seeks to bring relief to working families <a href="http://www.slate.com/blogs/xx_factor/2017/04/26/in_response_to_criticism_of_his_regressive_child_care_plan_trump_considers.html">farther down the economic ladder</a>.</p>
<p>According to <a href="https://www.washingtonpost.com/news/wonk/wp/2017/04/25/trump-changes-course-on-childcare-benefit-after-criticism-he-would-mainly-help-well-off-families">media reports based on skeletal details</a>, officials want to increase the Child and Dependent Care Credit, which lets <a href="http://www.taxcreditsforworkersandfamilies.org/federal-tax-credits/child-dependent-care/">working parents deduct up to US$2,100</a> from their taxes. That’s the kind of fix that would make our economy friendlier toward working moms as Yellen prescribed.</p>
<h2>More women working outside the home</h2>
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<p>The nation’s workforce has changed dramatically since the 1950s. Back then, workplaces generally centered around male breadwinners. Stay-at-home wives did most of the caregiving. </p>
<p>In a majority of families with children today, <a href="https://www.bls.gov/opub/reports/womens-databook/archive/women-in-the-labor-force-a-databook-2015.pdf">both partners earn money</a>, do housework and <a href="http://www.pewsocialtrends.org/2015/12/17/parenting-in-america">take care of their kids</a>. Families with children have become less likely to live with extended family members able to pitch in with caregiving and more likely to be headed by single parents. In 2013, <a href="http://www.pewsocialtrends.org/2013/05/29/breadwinner-moms/">the sole or primary earner</a> was the mother in nearly 40 percent of households with children.</p>
<p>On top of the time burden, child care costs are growing. <a href="https://www.care.com/media/cms/pdf/FINAL_Care_Report_09-27-2016.pdf">Full-time care</a> for kids under four years old ran $9,589 on average in 2015 – more than the tab for in-state college tuition, according to a report from Care.com, the largest online care market, and the New America Foundation, a think tank.</p>
<p>Another burden: The U.S. is the only industrialized nation <a href="http://www.politifact.com/truth-o-meter/statements/2016/jul/25/kirsten-gillibrand/yes-us-only-industrialized-nation-without-paid-fam/">without paid family leave</a> for employees with newborns. The Family and Medical Leave Act of 1993 covers only workplaces with more than 50 employees. It guarantees unpaid time off. </p>
<p>Some companies <a href="https://www.wsj.com/articles/wall-street-perk-parental-leave-1448927064">voluntarily offer</a> new mothers and fathers paid parental leave to care for newborns and newly adopted children. Others provide paid family leave for whatever emergency arises. </p>
<p>Unfortunately, <a href="http://www.npr.org/2013/02/05/171078451/fmla-not-really-working-for-many-employees">many workers can’t even take unpaid leave</a> without jeopardizing their jobs.</p>
<h2>Child care</h2>
<p>On top of the Child and Dependent Care Credit, the federal government <a href="http://www.nationalreview.com/article/443654/child-care-paid-leave-reforms-trump-administration-congress">helps working parents save on</a> child care expenses by allowing companies to let employees use dependent-care <a href="http://www.bankrate.com/finance/taxes/irs-can-help-you-look-after-the-kids-1.aspx">flexible spending accounts</a>.</p>
<p>These FSAs help middle- and high-income workers more than low-earners with little or no tax liability – whose need for help is greater. For them, there’s the Earned Income Tax Credit. Its distribution as an annual lump sum, averaging in most states <a href="https://www.eitc.irs.gov/EITC-Central/eitcstats">between $2,000 and $3,000</a>, is ill-suited for the <a href="http://www.cbpp.org/research/federal-tax/policy-basics-the-earned-income-tax-credit">cash-strapped families</a> scrambling to pay their bills year-round who are eligible for this benefit.</p>
<p>After experiencing <a href="http://www.taxpolicycenter.org/sites/default/files/publication/138781/2001170-who-benefits-from-president-trumps-child-care-proposals.pdf">widespread push-back</a>, the Trump administration recently said it would revise <a href="https://www.bloomberg.com/politics/articles/2017-02-23/ivanka-trump-is-pushing-her-500-billion-child-care-plan-on-hill">its initial proposals</a> to do more for low-income parents with limited tax liability or who pay no taxes at all. It also outlined plans for new child care and elder care savings accounts that included few details. </p>
<p>Earlier this year, The New York Times reported that the Trump administration was “contemplating” changes to its <a href="http://example.com/https://www.nytimes.com/2017/03/11/us/politics/ivanka-trump-women-policy.html?_r=0">original maternity leave proposal</a>. By giving new mothers six weeks of paid time off, even that plan would set an important precedent. But it would exclude adoptions and many increasingly common new configurations for <a href="https://www.shrm.org/resourcesandtools/hr-topics/employee-relations/pages/trump-paid-parental-leave-.aspx">American families</a>.</p>
<p>The Trump administration should ensure that all workers benefit from family-friendly tax and employment policies, not just high-paid earners and new mothers. Men and women alike should be free to take paid family leave, and all employees needing to care for their close relatives deserve an opportunity to do so without losing their jobs or obliging more women to <a href="https://www.americanprogress.org/issues/economy/reports/2013/12/12/81036/the-economic-benefits-of-family-and-medical-leave-insurance/">stay out of the labor force</a>.</p>
<p>Maximizing “women’s presence in the workplace … allows us to capitalize on the talents of our entire population,” as Yellen said. “It is also good business.”</p><img src="https://counter.theconversation.com/content/70381/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Cheryl Carleton does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The nation needs a more comprehensive approach to family leave and relief for parents with child care expenses. But the proposals the Trump team rolled out initially fell short.Cheryl Carleton, Assistant Professor of Economics, Villanova UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/649322016-09-22T17:11:57Z2016-09-22T17:11:57ZTo produce artisans for the future South Africa should study its past<figure><img src="https://images.theconversation.com/files/138053/original/image-20160916-6337-1wv007y.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Artisans are crucial for any economy.</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>South Africa’s government <a href="http://nadsc.dhet.gov.za/Document/News/04%20Feb%202013%20Briefing.pdf">knows</a> that artisans are essential to future growth and job creation. That’s what prompted the country’s Minister of Higher Education and Training to declare a “decade of the artisan”. The campaign’s motto states that it is “<a href="http://nadsc.dhet.gov.za/Document/News/04%20Feb%202013%20Briefing.pdf">cool</a>” to be a 21st century artisan. </p>
<p>What is the reality for modern artisans? Over the past four years I’ve led <a href="http://www.lmip.org.za/theme/occupational-milieus">research</a> for the <a href="http://www.hsrc.ac.za/en/research-areas/Research_Areas_ESD/LMIP">South African Labour Market Intelligence Partnership</a> to try and find out. We focused on better understanding artisans’ working environments and identities. This allowed us to identify some blockages in the production of artisans.</p>
<p>The research has yielded important findings. Firstly, structural inequalities seen elsewhere in the society are replicated in artisanal work and training. These are manifested in participation that is <a href="http://www.hsrcpress.ac.za/product.php?productid=2327">skewed</a> in terms of race, gender, age and language. </p>
<p>The quantitative data reflects a decline in racial inequality measured in terms of formal representation and access to occupations. But our qualitative data shows how the construction of artisanal work and occupations contributes to persistent racial, age and language exclusivity and dominance. These inequalities overlap and are reproduced in <a href="http://www.lmip.org.za/sites/default/files/documentfiles/504.%20The%20Shifting%20Boundaries%20of%20Artisanal%20Work%20And%20Occupations_0.pdf">complex ways</a> in occupational cultures.</p>
<p>Secondly, the South African labour market may not be able to absorb all the artisans coming through the Technical and Vocational Education and Training (TVET) system. </p>
<p>Our findings suggest that South Africa must confront its history more honestly if it’s to prepare the right amount of artisans who have appropriate skills for today’s job market. The country must also carefully examine its prevailing economic parameters to identify constraints and opportunities – and then reflect these in policy making. The existing policy is concerned with training more and more artisans, and improving their skills. There’s also a need to open up more opportunities for young, black and women artisans to shift historical trends of access and success.</p>
<p>But there’s a flip side: data on the employment of craft and related trades workers over the last decade indicates that the labour market for artisans has been contracting. This suggests a disjuncture between policy and the ability of South Africa’s labour market to provide employment.</p>
<h2>History cannot be ignored</h2>
<p>The <a href="http://www.labour.gov.za/DOL/downloads/documents/research-documents/Artisans%20trades_DoL_Report.pdf">history</a> of artisanal training and employment in South Africa has been one of systematic social exclusion and inequality.</p>
<p>Some researchers <a href="http://www.academia.edu/3527871/Rearranging_the_furniture_Shifting_discourses_on_skills_development_and_apprenticeship_in_South_Africa">trace the origins</a> of artisan training, through apprenticeships, to the arrival in South Africa of European settlers in the 1600s. This highlights its colonial roots and links to the system of slavery. </p>
<p>During the apartheid era, the social, political and economic exclusion of black people by the government became even more deeply entrenched. This resulted in very few qualified black artisans in particular sectors of the economy. </p>
<p>Its history illuminates what educationist Volker Wedekind <a href="http://www.academia.edu/3527871/Rearranging_the_furniture_Shifting_discourses_on_skills_development_and_apprenticeship_in_South_Africa">calls</a> the distinctive feature of artisanal training or apprenticeship in South Africa: “right from its earliest incarnation, it was a coercive and exploitative relationship, rather than a benign relationship between a master craftsman and a novice”.</p>
<p>This chequered history has translated into a negative discourse about the modern TVET system. People remain unsettled about artisanal training’s exploitative history even before apartheid. They also remember how it was used as a tool for social engineering during apartheid, keeping black South Africans out of certain careers.</p>
<p>Artisanal trades are viewed as being <a href="https://theconversation.com/history-explains-why-black-south-africans-still-mistrust-vocational-training-46998">lower in status</a> than professional qualifications or occupations. This is not distinctive to South Africa. What is unique, though, is the association of artisanal work with a limited set of technical, mostly manufacturing-related trades and occupations. Most countries have a far wider notion of artisanal work.</p>
<p>Luckily, there have been some strong efforts to alter these perceptions. These have involved political, systemic and policy changes. </p>
<h2>Raising awareness</h2>
<p>The Department of Higher Education and Training has spearheaded these efforts. For instance, in 2001 it introduced <a href="http://www.hsrc.ac.za/en/research-outputs/view/5675">learnerships</a>. These differ from apprenticeships: they operate across all sectors and all skills levels, whereas apprenticeships only catered for intermediate level or artisanal skilling. The new system was intended to address the shortcomings of the traditional apprenticeship system, particularly the lack of structured workplace learning. </p>
<p>The department has established <a href="http://www.labour.gov.za/DOL/legislation/acts/basic-guides/basic-guide-to-sector-education-and-training-authorities-setas">Sectoral Education and Training Authorities</a>, or SETAS. These entities, as part of a state driven national skills development system, are tasked with identifying and facilitating skills development in their respective industry sectors. </p>
<p>During the “<a href="http://www.engineeringnews.co.za/article/decade-of-the-artisan-programme-launched-30-000-artisans-a-year-targeted-2014-02-03">decade of the artisan</a>”, the department wants to produce 30 000 artisans a year. Currently the country produces <a href="http://www.dhetnews.co.za/artisan-roadshows/">about 15 000</a> a year.</p>
<p>All of this is a good start. South Africa’s economy definitely needs more artisans to support its <a href="http://www.gov.za/issues/national-development-plan-2030">planned growth trajectory</a>. But the country must more honestly confront the extent of negativity about TVET among its citizens. This requires proper surveys to understand people’s attitudes to certain types of work and occupations. Some national data on attitudes to work exist, but this needs to be significantly strengthened. There also needs to be systemic collection of data about attitudes to occupations.</p>
<p>At least work has been done to ensure <a href="http://www.gov.za/documents/skills-development-act-national-artisan-development-trade-test-pass-rate-and-quality">a policy framework</a> that interrogates artisanal skills production more broadly than before. Now this must be paired with realistic messaging about what opportunities really exist for artisans.</p>
<p>What does the economic evidence tell us about the future of such work?</p>
<h2>The economy matters</h2>
<p>Our study evaluated the twentieth century history of artisanal training in South Africa, against a backdrop of the production environment in which the training was provided, the broad economic and political events and policies. It draws on available economic and skills development data up until 2011, with the discussion divided mainly into pre-democratic and democratic eras demarcated by the year 1994, which was when the country underwent the political transition from a racially exclusive system into a democratic one. The overarching finding is that South Africa’s formal economy has grown in the last two decades. </p>
<p>In the same period, primary and secondary sectors like mining and agriculture – which historically strong formal employers of artisans – have declined. This has been accompanied by intensified employment in the tertiary sector, which consists of the wholesale, accommodation, financial, private and public services sectors, for instance. The secondary sector of the economy includes sub industries such as manufacturing, electricity and construction.</p>
<p>Craft and related trades workers – the occupational group where artisanal employment is recorded – experienced the greatest formal (-3,5%) and informal (-4.8%) employment losses between 2005 and 2011. </p>
<p>Given this evidence, hard questions must be asked. Does the labour market has the capacity to fully absorb new artisans. If so, at what rate and in which sectors? Is South Africa training the right kinds of artisans? Are they being trained in the right ways? </p>
<h2>Towards a realistic future for artisans</h2>
<p>Our research suggests that South Africa must look to its history and its current economic situation so it can engage realistically around how to influence the prevailing discourse on artisanal work and training. If artisanal employment is to be very different from the past, then artisanal skilling - and planning for TVET - will have to change in the future.</p><img src="https://counter.theconversation.com/content/64932/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Angelique Wildschut is a Senior Research Specialist at the Human Sciences Research Council. The research project from which the data for this paper were extracted was funded by the Department of Higher Education and Training, South Africa. The project forms part of a broader programme of research to underpin the establishment of a credible institutional mechanism for skills planning in the country (the LMIP).</span></em></p>The history of artisanal training and employment in South Africa has been one of systematic social exclusion and inequality.Angelique Wildschut, Senior Research Specialist in Education and Skills Development, Human Sciences Research CouncilLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/566592016-03-31T10:25:25Z2016-03-31T10:25:25ZWe need to look beyond unemployment to fix labor market inequality<p>When we think about disadvantages and challenges in the labor market, unemployment generally takes center stage, clearly exemplified by the <a href="http://www.bls.gov/news.release/empsit.nr0.htm">monthly jobs report</a> hype over one stat: the unemployment rate. </p>
<p>Is it up or down? What will it be next month? </p>
<p>The same is true in the academic world. While there is voluminous research on the causes and consequences of unemployment, there is less scholarship (although certainly some) on what it means to be involuntarily working part-time or stuck in a job that doesn’t fully utilize your skills. </p>
<p>Labor market insecurity and inequality aren’t just about whether someone is employed or not. In new research, I seek to address this issue by examining how being employed part-time or in a job you’re overqualified for affects your ability to get a new position. </p>
<h2>What’s missing from the jobs report</h2>
<p>If you dig past the headlines about the Bureau of Labor Statistics’ jobs report, released on the first Friday of every month, you’ll find some data on the number of individuals employed part-time for “economic reasons.” That is, they’d prefer to work full-time but aren’t doing so either because they couldn’t find such a job or because their hours were cut back. They are involuntary part-time workers. </p>
<p>Regardless of how far you read, though, there is one group missing from the report entirely: workers who are in jobs below their skill level, education or experience. These workers – who are often referred to as occupying positions of skills underutilization – go largely unexamined when we discuss the employment landscape in the U.S.</p>
<p>Similarly, in the academic world, part-time work and skills underutilization receive less attention than unemployment. A Google Scholar search for “unemployment” results in <a href="https://scholar.google.com/scholar?hl=en&q=unemployment&btnG=&as_sdt=1%2C44&as_sdtp=">over 2 million hits</a>, while searches for “part-time employment” or “part-time work” lead to roughly 300,000 results. </p>
<p>Fewer than 10,000 results are generated by searches for “skills underutilization,” “skills underemployment,” “overqualification” or “skills mismatch,” terms often used to describe workers in positions below their level of skill, education or experience.</p>
<h2>The consequences of being unemployed</h2>
<p>Overall, the large body of academic research on unemployment indicates that there are far-reaching consequences of being unemployed. These effects span many domains of life, from health to family dynamics to psychological well-being. </p>
<p>One question that scholars have explored recently is whether being unemployed actually makes it harder to get another job. The answer appears to be yes. </p>
<p>For example, from August 2011 to July 2012, a team of economists sent out fake job applications for real openings and randomly gave some of the CVs an employment gap – that is, an ongoing spell of unemployment ranging from one to 36 months at the time the application was submitted. They <a href="http://qje.oxfordjournals.org/content/128/3/1123.full">found</a> that employers were more likely to pass over applicants with longer gaps, with much of decline in employer interest occurring in the first eight months.</p>
<p>Using similar methods, a team of Swedish researchers <a href="http://www.ingentaconnect.com/content/aea/aer/2014/00000104/00000003/art00010">found</a> that workers who had been unemployed for at least nine months when applying for a job received significantly less interest from employers.</p>
<p>I wondered, does something similar happen to job applicants employed in part-time positions or in jobs below their skill level? </p>
<h2>Penalty for part-time or skills underutilization?</h2>
<p>Existing research has not fully addressed this issue, so I set out to explore this possibility, using methods similar to those employed by the previously mentioned studies on unemployment. I sent out thousands of fake job applications to apply for real openings in five major U.S. cities and across four types of occupations. </p>
<p>The results of the study, presented in an article <a href="http://asr.sagepub.com/content/81/2/262.abstract">published</a> in the April 2016 issue of the <em>American Sociological Review</em>, reveal that, for male job applicants, being employed in a part-time position or a job beneath their skill level is severely penalizing compared with those who remained employed in full-time positions at their skill level. </p>
<p>Male job applicants with full-time, standard jobs received “callbacks” (positive responses) from employers 10.4 percent of the time. However, the callback rate dropped to 4.8 percent for men in part-time positions and 4.7 percent for men in jobs that underutilized their skills. Indeed, men in these positions were treated no differently by potential employers than men who were unemployed, who received a 4.2 percent callback rate.</p>
<p>The story is a bit different for female job applicants. Similar to men, women in jobs beneath their skill level were penalized in a significant way compared with those in jobs at their skill level. Women in full-time, standard jobs at their skill level received callbacks 10.4 percent of the time, compared with 5.2 percent of the time in positions of skills underutilization. </p>
<p>However, women in part-time positions faced no penalty compared with those who remained employed full-time, receiving a callback rate of 10.9 percent. Women in part-time positions fared significantly better than men in part-time positions.</p>
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<h2>Easing labor market inequality</h2>
<p>Unemployment is, of course, extremely important and has far-reaching consequences for workers and their families. </p>
<p>But the effects of part-time work and skills underutilization are also real and affect <a href="http://www.bls.gov/cps/cpsaat08.htm">millions</a> of <a href="http://sf.oxfordjournals.org/content/85/2/835.short">workers</a> in the United States. Yet they are less frequently discussed and sometimes remain absent from our thinking about labor market inequality.</p>
<p>Emphasizing data on involuntary part-time work in the jobs report and thinking about public policy interventions to improve the outcomes of workers in these types of positions are of significant importance. And we should begin to regularly collect, analyze and publicize data on the number of workers employed in positions below their level of skill, education and experience. It would serve as an important addition to the monthly data on unemployment and part-time work.</p>
<p>Having data and detailed information on this population is an important step on the path to improving the economic security and labor market opportunities of the U.S. workforce.</p><img src="https://counter.theconversation.com/content/56659/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>David S. Pedulla's research has received funding and support from the following entities: the National Science Foundation, the W.K. Kellogg Foundation, the Russell Sage Foundation, the UC-Davis Center for Poverty Research, the Horowitz Foundation for Social Policy, the Employment Instability, Family Well-Being, and Social Policy Network at the University of Chicago, the National Institute of Child Health and Human Development, Princeton University’s Department of Sociology and Center for African American Studies, the Fellowship of Woodrow Wilson Scholars, and the Population Research Center at the University of Texas at Austin.</span></em></p>There’s been a lot of research on whether being unemployed hurts your ability to get a new job. But what about if you’re working part-time or below your skill level?David S. Pedulla, Assistant Professor, Department of Sociology & Population Research Center, The University of Texas at Austin College of Liberal ArtsLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/567902016-03-24T10:07:22Z2016-03-24T10:07:22ZHow to transform workers’ campaign rage into better jobs and wages<p>The presidential campaigns deserve some credit for finally voicing some of the deep frustrations and anger felt by American workers who have lived for decades in an economy that works for those at the top but not for them and their families. </p>
<p><a href="https://theconversation.com/america-doesnt-just-need-a-raise-we-need-a-new-national-norm-for-wage-growth-46831">Thirty years of wage stagnation</a>, the <a href="http://www.epi.org/publication/manufacturing-job-loss-trade-not-productivity-is-the-culprit/">loss of one-third of the nation’s manufacturing jobs since 1970</a>, a <a href="https://theconversation.com/how-do-we-ensure-the-next-generation-of-workers-isnt-worse-off-than-the-last-52110">failure to generate enough quality jobs</a> and career opportunities for young workers and unacceptable levels of income inequality are now coming home to roost. </p>
<p>It is not surprising that the angriest voices are coming from working-class men and young people who have entered the workforce in the last decade, the <a href="http://www.epi.org/publication/ib327-young-workers-wages/">two groups that have lost the most ground</a> and feel they have no one standing up for them and no control over their future. </p>
<p>And one of the main reasons for these trends is largely missing from the campaign trail: the loss of bargaining power and any means of having a voice at work. </p>
<p><a href="http://www.bls.gov/news.release/union2.nr0.htm">Unions now represent only about seven percent</a> of the private sector workforce, and recent attacks on public sector unions are now leading to their decline as well. The Supreme Court will soon decide whether or not to <a href="https://theconversation.com/attack-on-unions-shows-why-we-need-a-new-social-contract-governing-work-52884">further weaken public employee unions</a> by eliminating rules requiring nonmembers to pay their fair share of the costs to represent them. </p>
<p>But angry rhetoric will not put the economy on a path that works for the disaffected and disenfranchised. Instead we need to address the root causes of workers’ frustration and their economic decline. And to do that, I would argue, we need to fix our broken labor policy. </p>
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<h2>Decline of unions</h2>
<p><a href="http://www.asanet.org/images/journals/docs/pdf/asr/WesternandRosenfeld.pdf">Recent studies estimate</a> that 20 percent or more of the current wage inequality is due to the decline of unions and worker bargaining power. </p>
<p>But perhaps because of the public’s ambivalence toward unions, none of the candidates has laid out a strong and positive vision or strategy for rebuilding workers’ bargaining power in ways that fit what they want now or that can be successful in today’s economy. </p>
<p>Any strategy for rebuilding bargaining power has to start with fixing a broken labor law that no longer provides workers access to collective bargaining. Today, if management resists worker efforts to organize (and they nearly always do), <a href="http://edworkforce.house.gov/uploadedfiles/4.30.10_ferguson.pdf">less than one in 10</a> union organizing efforts results in a collective bargaining agreement. </p>
<p>The odds are so stacked against workers and unions that few see trying to organize as a viable option.</p>
<p>The ways to fix this aspect of labor law are well-known: strengthening penalties against employers or unions that violate the law, shortening the time required to hold an election to determine if a majority votes for union representation and having a neutral arbitrator set the terms of the first contract if one party or the other stonewalls the process.</p>
<h2>Labor management partnership</h2>
<p>But these reforms have been impossible to get through Congress in the past, and as stand-alone proposals will be equally difficult in the future. </p>
<p>They need to be combined with provisions that promote the forms of worker-management relations that have demonstrated their value in generating and fairly sharing productivity and economic growth. It’s also important that they support the new ways workers are finding a voice. </p>
<p>The labor-management partnership in place for nearly two decades at health care provider Kaiser Permanente, for example, is a model for the type of modern labor management relationship. It both promotes improvements in patient care and organizational performance and ensures workers share fairly in the economic savings they help generate. </p>
<p><a href="http://www.amazon.com/Healing-Together-Labor-Management-Partnership-Permanente/dp/0801475465">Our research group</a> tracked the evolution of this partnership from its inception. <a href="http://mitsloan.mit.edu/uploadedFilesV9/Academic_Groups/Work_and_Organization_Studies/Media/FINAL-KPreport130947.pdf">We found</a> that Kaiser Permanente is a leader in use of union-management sponsored front-line teams that focus on improving health care delivery, a leader in use of electronic medical records to keep people healthy and out of hospitals, and pays industry leading wage and benefits. </p>
<p>Ford, the only U.S. car company that avoided a government bailout, has a <a href="http://www.amazon.com/Inside-Ford-UAW-Transformation-Pivotal-Delivering/dp/0262029162/ref=sr_1_fkmr1_1?s=books&ie=UTF8&qid=1458766158&sr=1-1-fkmr1&keywords=Cutcher+Gershenfeld+Ford+partnership">similar partnership</a>, which <a href="http://www.aflcio.org/Blog/Organizing-Bargaining/Stronger-Together-Labor-and-Management-at-Ford">helped it recover</a> from losing US$17 billion in 2006 to making $7.4 billion and paying each union member $9,300 in <a href="http://www.detroitnews.com/story/business/autos/ford/2016/01/28/ford-earnings/79448532/">profit sharing</a> in 2015.</p>
<p>A modernized labor policy should encourage such partnerships fitted to the needs of different industries and occupations.</p>
<p>Modernizing labor law also will require extending protections against discrimination and opening it up to people working in the diverse array of organizational settings today, not just the nonsupervisory employees in traditional employment relationships currently covered by the 1935 vintage labor law. </p>
<p>A growing number of workers are employed in subcontractor or franchised arrangements (think McDonald’s) in which the employer who controls their work and future is unreachable. Those classified as independent contractors in the so-called platform or “gig” economy (think Uber drivers) are likewise excluded and have no legally protected means of organizing or engaging the executives who set their fares and control their access to customers. </p>
<p>All these groups need protection from discrimination if they try to mobilize and seek to negotiate with whoever sets their terms and conditions of employment.</p>
<h2>Keeping up with the times</h2>
<p>A forward-looking labor policy will also need to recognize and support the many innovative initiatives under way that are attempting to help workers who prefer to move to a better employer when faced with unfair or unacceptable practices at their current workplace. </p>
<p>Indeed, a growing number of “apps” are coming along that support worker mobility. Examples include those being incubated through the <a href="http://theworkerslab.com">Workers Lab</a>, <a href="https://turkopticon.ucsd.edu">Turkopticon</a> for those choosing who to work for on Amazon’s Mechanical Turk and <a href="https://www.sherpashare.com">Sherpashare</a> and other groups providing drivers comparative information on earnings opportunities at Uber, Lyft and other platforms. </p>
<p>Further experimentation with these innovative efforts will test the viability of using information and transparency as new sources of worker power. Those experimenting with these new approaches deserve to be protected from discrimination for raising their voice. </p>
<p>I would go further and open up the law to encourage experimentation and evaluation of these emerging efforts. Let these worker entrepreneurs show us new ways to harness technology in support of today’s workforce.</p>
<h2>Shaping the future of work</h2>
<p>I believe that American workers are thirsty for a positive vision and strategy that restores workers’ ability to have a constructive voice at work and that provides enough real power to regain a voice in shaping their future. </p>
<p>So it is time for those who seek their support to abandon the divisive and negative rhetoric that feeds their frustration and instead propose a viable way forward. Perhaps the best way to invent the next generation labor policy is to listen to workers themselves talk about what they want, need and are trying to do to regain control of their destiny at work. </p>
<p>So let me end with an invitation: we will be taking up these and other issues in how to Shape the Future of Work in an <a href="https://www.edx.org/course/shaping-future-work-mitx-15-662x">MITx online course</a> starting next week. Join us in this course and see what real workers – young, midcareer and beyond – are saying about their visions for the future of work and the future of worker representation. </p>
<p>This is just one way we can deliver their message to the candidates desperate to gain their support. </p>
<img src="https://counter.theconversation.com/content/56790/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Thomas Kochan does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Presidential candidates are using voter anger to fuel more divisions and discord rather than to start a conversation about the collapse of collective bargaining.Thomas Kochan, Professor of Management, MIT Sloan School of ManagementLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/521102015-12-10T11:18:54Z2015-12-10T11:18:54ZHow do we ensure the next generation of workers isn’t worse off than the last?<p>Discussions about the future of work are clearly in the air. </p>
<p>This week, Secretary of Labor Tom Perez is convening a <a href="https://blog.dol.gov/2015/12/03/the-future-of-work/">three-day symposium</a> on the issue. Simultaneously, the <a href="http://www.hamiltonproject.org/events/modernizing_labor_laws_in_the_online_gig_economy">Brookings Institution</a> hosted a discussion about the implications of the “gig” economy for work and employment policy. At MIT, we are also planning a similar conversation for early next year. </p>
<p>And in Silicon Valley, leaders of high-tech companies and worker advocates have <a href="https://medium.com/the-wtf-economy/common-ground-for-independent-workers-83f3fbcf548f#.sm7tw581x">recently started discussing</a> new ways to offer benefits to contract workers following several high-profile cases in which <a href="http://www.latimes.com/business/hiltzik/la-fi-mh-uber-s-business-model-20150902-column.html">Uber drivers</a> and others have sued to be considered regular employees and gain the accompanying benefits. </p>
<p>All this couldn’t come at a better moment, but time is of the essence. Unless talk leads to actions to change the course of the economy and labor market, the next generation of workers is destined to experience a lower standard of living than their parents – the opposite of the American Dream.</p>
<p>I share a deep concern that is motivating this flurry of discussion. This concern for the next generation is the major theme in my current research, book and online MIT MOOC (massive open online course) devoted to <a href="http://www.amazon.com/Shaping-Future-Work-Thomas-Kochan/dp/1631574019">Shaping the Future of Work</a>. The central challenge we face is to update our employment policies to catch up with changes in the economy, workforce and employment structures. </p>
<p>How can we do it?</p>
<h2>Confronting our problems head-on</h2>
<p>My hope is that everyone participating in these discussions is ready and willing to face our problems squarely by putting on the table the tough choices and changes in strategy and behavior America needs from labor, business and government to turn things around and build a better future for the next generation. </p>
<p>I’ve been in far too many soft-minded discussions that avoid the tough issues. It is always easier to agree on the need for better education and training or to cheerlead the practices of leading companies without asking how do we make these the norm rather than the exception. We need to go beyond these polite discussions. </p>
<p>We have to address the fact that so many young people <a href="https://theconversation.com/lackluster-jobs-growth-and-stagnant-wages-show-why-the-fed-shouldnt-raise-interest-rates-just-yet-45818">have been scarred</a> by starting their careers in the “lost decade” when wages weren’t rising even for college graduates and 40% of those with bachelor’s degrees <a href="http://www.bls.gov/opub/mlr/2010/11/art1full.pdf">started out underemployed</a>, working in jobs that neither utilize their education nor provide further training and development opportunities. </p>
<p>The <a href="http://www.dailyfinance.com/2009/09/25/yale-study-starting-career-during-recession-can-damage-salary-f/">evidence</a> shows workers who start their careers this way have a very hard time getting on track to higher-paying job opportunities. </p>
<p>Here are three of the tough questions that need to be front and center in these discussions, each of which will call for big changes in labor, business and government strategies.</p>
<h2>How do we rebuild worker bargaining power?</h2>
<p>The primary challenge facing workers and the economy is how to end the 30 years of wage stagnation and reverse the <a href="https://theconversation.com/inequality-can-be-addressed-only-if-we-start-talking-about-the-working-class-44442">income inequality</a> that is holding back economic growth. </p>
<p>Bargaining power in the <a href="https://books.google.com/books?id=SK5opOtSfpMC&hl=en">heyday of rising wages</a> (prior to 1980) came largely from unions threatening strikes and spreading collectively bargained wages across firms within industries. Those sources of power dried up in the 1980s. </p>
<p>Today workers, supported by future unions and professional associations, need to use their knowledge and skills as a key source of power. This requires two things. First, workers will have to gain and periodically refresh the skills they need to remain competitive in their labor markets over the full course of their careers. Second, organizations and technical “apps” are important to mobilize them and help them move jobs from bad to good employers. </p>
<p>The ability to exit workplaces with below standard employment practices may be as important a source of power for the workforce of the future as direct bargaining to change those practices was for workers in the past. </p>
<p>This means that labor organizations have to build the capacity to support and maintain members’ skills and <a href="http://cognoscenti.wbur.org/2015/09/08/the-future-of-labor-in-america-thomas-kochan">provide</a> the information, portable benefits and mobility supports needed to move from one employer to another over the full course of their working careers. </p>
<p>Various groups are working on “<a href="http://www.workamerica.co/">apps</a>” to provide information on good and bad employers. Putting them to use to mobilize workers and enforce high-quality employment practices may just be the next generation workforce’s best source of bargaining power.</p>
<h2>How do we get more employers to take the high road?</h2>
<p>Employers beware. These discussions will also not be easy on you. </p>
<p>You will be challenged to end the <a href="http://www.upjohn.org/publications/upjohn-institute-press/sustainable-prosperity-new-economy-business-organization-and">era of financialization</a> of the American corporation that now has dominated for 30 years. The American economy can no longer afford to let corporations fixate on maximizing short-term shareholder returns at the expense of other stakeholders, particularly employees. </p>
<p>This was not the <a href="http://www.amazon.com/Investor-Capitalism-Michael-Useem/dp/0465050328">corporate mantra</a> of the era when wages moved in tandem with productivity. The good news is a <a href="http://cepr.net/publications/reports/high-performance-work-practices-and-sustainable-economic-growth">large body of research</a> has shown how to compete on the basis of high productivity and high wages, and yes, we all have our favorite visible examples of companies that do this, such as <a href="https://hbr.org/2015/12/how-southwest-airlines-hires-such-dedicated-people">Southwest Airlines</a>, Costco, Kaiser Permanente, SAS and, our New England favorite, <a href="https://www.bostonglobe.com/business/2014/07/24/personal-touch-family-feel-won-workers-loyalty-market-basket-grocery-chain/Y21o2OT2qwr2Dzwf588iHK/story.html">Market Basket</a>. </p>
<p>The key question for discussion here: how do we go from these examples as the exceptions or outliers to make them the norm in business? </p>
<p>This will require more than cheerleading. It will require broader use of alternative forms of corporate governance, from employee stock ownership to benefit corporations to cooperatives and, perhaps, to bringing workers’ voices directly into corporate boardrooms. </p>
<p>Tough issues indeed.</p>
<h2>How do we end 30 years of labor policy gridlock?</h2>
<p>Perhaps the toughest question to put on the table is how to end the 30-year <a href="http://www.catholicscholarsforworkerjustice.org/Kochan%20and%20Ferguson%20Labor%20Law%20op-ed%206%2015%2007%20.pdf">gridlock</a> over labor policy.</p>
<p>We cannot shape the future of work unless we <a href="https://theconversation.com/long-overdue-overtime-update-will-give-boost-to-workers-and-economy-44488">update labor law</a> to provide all workers, regardless of whether they are hourly employees, managers or independent contractors, the ability to organize and negotiate to improve their working conditions. Other employment policies that set the floor on working conditions such as such as minimum wages and overtime, equal employment opportunity, social security, health insurance, etc also need to be extended to those now excluded. </p>
<p>But let’s be realistic. Congress is so divided today that there is little hope for immediate solutions. Maybe a first step could be taken by building consensus out of these meetings that fundamental change and updating of employment policies are needed. </p>
<p>Perhaps those participating in these discussions with the labor secretary and in various think tanks and universities could call for an era of policy experimentation. We could ask this administration – or, if necessary, the next one – and, where necessary, the Congress to authorize the secretary of labor to experiment with and evaluate a variety of new approaches to worker voice, a “third way” of classifying workers in the gray area of employee-contractor status and to work in coalition with community, business and labor groups to complement and extend the reach of labor standards enforcement. </p>
<p>Creating the legal spaces needed to try new ideas like works councils, advisory bodies made up of representatives of all workers and managers in an enterprise, or regional or sectoral negotiations over wages would be a good starting point. Expanded use of the type of statewide and industry-level wage boards <a href="https://www.governor.ny.gov/news/governor-cuomo-instructs-state-labor-department-convene-wage-board-investigate-and-make">pioneered this year</a> by Governor Andrew Cuomo in New York would be another option. So too would <a href="https://theconversation.com/america-doesnt-just-need-a-raise-we-need-a-new-national-norm-for-wage-growth-46831">giving weight</a> to employment practices that generate high productivity and good wages in choosing among bidders for government contracts. </p>
<p>Together, actions like these might just unleash the broad-based experimentation and innovation needed to identify the best options for national policy reform when the political forces eventually align to make this possible. </p>
<p>So let the discussions begin. But let us not avoid the hard issues. </p>
<p>Stay tuned. I’ll report on what comes out of the labor secretary’s confab and the others to come down the road.</p><img src="https://counter.theconversation.com/content/52110/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Thomas Kochan has received funding from The Thomas Haas Foundation for his work on building a new social contract for the next generation workforce. He is also on the steering committee for the Employment Policy Research Network.
</span></em></p>Talk about the future of work is in the air these days, but will all the chatter lead to action and better living standards for tomorrow’s workers?Thomas Kochan, Professor of Management, MIT Sloan School of ManagementLicensed as Creative Commons – attribution, no derivatives.