Population ageing and the employment surge among older Australian workers

People and Place, June, 2009 by Ernest Healy

Over the past ten years labour-force participation rates and employment rates for people aged 55 and over have increased. During the last year from March 2008 to March 2009 employment rates for young people fell but those of the 55 and over group continued to rise. The data show that older people's growing participation in the labour force is a long-term trend and one that runs counter to alarmist talk about the effects of an ageing population on the size and skills of the labour force.

INTRODUCTION

The Australian potential labour force (or persons aged 15 plus) grew by approximately 21 per cent in the ten-year period 1998 to 2008. The growth in the number of employed persons was nearly 2.2 million, or 25 per cent (see Table 1). On average, the number of employed persons grew annually by approximately 216 thousand during that decade and the labour force grew in the order of 191 thousand annually. The difference between these two figures is due to a reduction in the unemployment rate and an increase in the participation rate between 1998 and 2008.

Table 1: Labour-force status 1998 and 2008, (1) persons aged 15 years
and over and per cent change 1998 to 2008

                Employed Total  Unemployed  Labour Force
                    '000        Total '000     '000

1998                 8618           721         9339

2008                10,777          477        11,254

Change 1998 to       2159          -244         1915
2008 (number)

Change 1998 to       25.0          -34.0        21.0
2008 (per
cent)

                 Not in labour    Civilian     Participation
                  force '000      population        rate
                                aged 15  '000

1998                 5432           14,771           63

2008                 5954           17,208           65

Change 1998 to        521             2436            -
2008 (number)

Change 1998 to       10.0            16.0             -
2008 (per
cent)

Source: Australian Bureau of Statistics, Labour Force Survey, monthly
data for years 1998 and 2008

Notes: (1) Annual data presented is the average of each respective
years monthly count.

(2) Data includes persons 15 years and over.

During 2008, this extended period of rapid employment growth abruptly ended. Australian Bureau of Statistics (ABS) monthly Labour Force Survey data show that, although the labour force continued to grow strongly between March 2008 and March 2009, employment did not. While the labour force increased by 237 thousand persons, a much larger number than the annual average for 1998 to 2008, the number of employed persons grew by only 23 thousand. By contrast, the number of unemployed persons grew by 214 thousand, a sharp reversal of the long-term trend.

A close examination of labour-force change from March 2008 to March 2009 shows that, within this overall pattern of slowed employment growth, outcomes varied markedly between age groups and by sex. Table 2 shows the change in the numbers of persons aged 15 plus who were employed, unemployed, not in the labour force and who were in the civilian population from March 2008 to March 2009, by five-year age groups and sex.

Table 2: Change in labour-force status for persons aged 15 years and
over, by age and sex, Australia, March 2008 to March 2009

                 Employed   Unemployed  Labour  Not in   Civilian
                total '000  Total '000  force   labour  population
                                        '000    force    aged 15 
                                                '000    years '000

Males

15-19              -36          24       -12      20         8

20-24               -1          22        21      -8        13

25-34              -30          34         4      28        33

35-44              -22          19        -3      14        11

45-54              -10          21        11      12        23

55-59               11          -1        10      -3         8

60-64               32           5        37     -15        23

65 and over         19           3        22      19        41

Total 15 years     -35         127        91      67       159
and over

15-24              -36          46        10      11        21

25-54              -62          74        12      55        67

55 plus             63           7        70       1        71

Females

15-19               -4          13         9       0         9

20-24              -28          22        -6      16        10

25-34               -1          21        20       7        27

35-44               20          11        31      23         8

45-54               12          13        25      -2        23

55-59               30           8        38     -27        11

60-64               30           0        30      -6        24

65 and over          0           0         1      37        38

Total 15 years      58          88       146       3       149
and over

15-24              -32          35         2      16        18

25-54               30          45        75     -18        58

55 plus             60           8        68       5        73

Persons

15-19              -40          37        -3      20        17

20-24              -29          44        15       8        23

25-34              -31          55        24      35        60

35-44               -3          30        27      -8        19

45-54                3          34        36      10        46

55-59               41           7        48     -30        18

60-64               62           5        67     -20        47

65 and over         20           3        23      56        79

Total 15 years      23         214       237      70       308
and over

15-24              -68          80        12      27        39

25-54              -31         119        88      37       125

55 plus            122          15       137       6       144

Source: Australian Bureau of Statistics (ABS), Labour Force Survey,
monthly data for March 2008 and March 2009

Note: (1) Data include persons 15 years and over.