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Home | Challenges of unemployment and underemployment

Unemployment and underemployment

Unemployment and underemployment pose significant challenges to Australians and the economy. When we talk about unemployment in government reporting we generally mean people who have no paid employment and are actively seeking employment. People who work just one hour a week do not count as unemployed in official figures even when they are actively seeking more work (they are underemployed). People who cannot actively seek employment, or become discouraged and have stopped looking for work, are also not included in the headline unemployment numbers.

Many Australians face uncertain job situations, not because they lack skills or experience, but because there are not jobs available. Economic conditions, structural changes in demand for skills, and difficulties around labour mobility (a mismatch of where the job is located and where the person looking can live) all impact employment opportunities. The nature of the job market has also changed, with casual work and the “gig economy” growing in prevalence. Unfortunately, an uncertain job market increases the risk of worker exploitation and people feel they have fewer options and less ability to stand up for themselves.

Unemployment, underemployment and casualised employment can be a major source of stress that has the potential to compromise the health and wellbeing of individuals. In Australia we have an income support safety net for people seeking work but it is currently set at such low levels that it does not provide enough to allow a person to live and seek work and can trap a person in poverty and unemployment. Currently in Australia, about 750,000 people are “long-term unemployed”, meaning they have been receiving income support payments for 12 months or longer.[1]

Secure employment provides more than just financial stability. It provides an opportunity to grow skills and make a contribution. This is why addressing the barriers to employment is so critical to the wellbeing of individuals and our community.[2]

Since November 2022 the underemployment rate has risen steadily and is nearly twice the headline unemployment rate.[3]

Secure employment provides more than just financial stability. It provides an opportunity to grow skills and make a contribution. This is why addressing the barriers to employment is so critical to the wellbeing of individuals and our community.[4]

44 per cent of the population, approximately 8.6 million Australians, have experienced mental ill health at some point in their life[5]

48% with disabilityvs 80% without disability

Only 48 per cent of people with disability are employed, compared to 80 per cent of people without disability.[6]

We have the power to make a difference

We can urge action from our governments

Governments can address some negative impacts of unemployment by ensuring that our income support safety net is fit for purpose. This involves an immediate increase to income support payments such as JobSeeker and Youth Allowance.

Governments can also re-examine the measures of economic success to recognise the negative impacts of unemployment. At the Commonwealth level, work has already begun on considering budget decisions through a wellbeing framework. This thinking could be extended to committing to full employment and making sure our ideas of unemployment shift to account for underemployment.

Other concrete actions governments can take involve positive promotion and working with industries that currently struggle to attract workers to make them attractive to jobseekers. Governments can also ensure that employment services are fit for the purpose of helping jobseekers, including by implementing measures like mandatory minimum professional standards.

We can implement change in our community and our workplaces

Businesses have a huge role to play in both creating employment opportunities and ensuring that workers are treated fairly. In our workplaces we can make sure that employees are aware of their rights and feel safe and comfortable raising any concerns they have.

Businesses can also consciously implement strategies to increase employment opportunities for a diverse range of people, recognising the significant contribution that any person can make. For example, we can significantly broaden our thinking about the wide range of contributions people with disability can bring to the workplace.

Community groups can also be a wonderful place of belonging for people experiencing unemployment. In our community groups we can provide opportunities for people to volunteer and remain connected to their community, as well as build and maintain valuable skills.

We can have influence in our personal lives

When people in our circles are unemployed we can be sympathetic and respectful. We can work to dismantle preconceived ideas about those experiencing unemployment, acknowledging that many barriers to employment exist outside of an individual’s control.

Unfortunately, some companies have taken advantage of the precarious nature of the jobs market. As consumers we can avoid using services and industries that are known to have exploitative employment practices.

  1. Australian Bureau of Statistics. (2024, May). Labour Force, Australia. ABS. [Link] ↩︎

  2. Australian Council of Social Services (ACOSS). Faces of Unemployment 2021. ACOSS: Strawberry Hills. [Link] ↩︎

  3. Australian Bureau of Statistics. (2024, May). Labour Force, Australia. ABS. [Link] ↩︎

  4. Australian Institute of Health and Welfare. (2023). Employment and unemployment. [Link] ↩︎

  5. Skinner, A. (2023). Unemployment and underemployment are causes of suicide. Science Advances, 9(28). [Link] ↩︎

  6. Australian Institute of Health and Welfare. (2022). People with disability in Australia. [Link] ↩︎

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