If you believe the ABC news headline, Martin Parkinson is doing a fine turn as our national slave-driver, exhorting Australians to work harder.
Or, alternatively, you could read the actual speech, which says nothing of the sort.
In a nutshell, Parkinson is concerned about Australia’s poor productivity performance. But his suggested remedies include :
Reforms to improve the productivity of the growing health and education services sectors, and make them more responsive to market signals, make sense. This is particularly important in the areas of vocational training and tertiary education.
Tax reforms that improve resource allocation and labour mobility, make sense — especially to state taxes like stamp duty and property taxation.
Appropriate policies to mitigate climate change at minimum cost also make sense.
Look, there’s plenty of room for debate about Parkinson’s suggestions; to take just one, I am skeptical, to say the least, of the notion that “market signals” make a lot of sense in the health sector.
But – getting back to the headline in the ABC online article – it’s extremely doubtful that “working harder” is going to be a significant driver of productivity in health. There is, by contrast, immense scope for the health system to work smarter. To take a very simple example, how much time is wasted – and damage to patients’ health caused – by doctors’ notoriously bad handwriting?
Amongst Julia Gillard’s rhetorical sins, her exhortations to “hard work” seem to have put the notion that putting our national nose to the grindstone is the way to riches back in the popular and media consciousness. The sooner we can dispose of that idea, the better.
Elsewhere: Quiggin riffs off the same article to suggest that Australians should get six weeks of annual leave as a legislated minimum. Hear hear.
I’m less interested in what he said than in the fact that he said it. Am I the only one who finds it worrying that a senior public servant is making speeches about policy? He’s entitled to have opinions, and a key part of his job is to advise the government, but publicly campaigning for a particular set of policies goes way beyond that. I think its symptomatic of the way politics has been reduced to a non-ideological, managerialist contest that people think this is ok.
Another example of how the health system could be streamlined is that when you visit Outpatients plaster clinic you could make your next appointment for the 6 month check up as you leave, rather than waiting for the letter from administration telling you attend. Won’t happen because hospitals manipulate outpatients waiting lists. Hospitals that fail to manage their waiting lists get fined giving them less funds to manage their burgeoning patient queues.
My local hospital, The Alfred, has had a massive increase in patient numbers through Emergency in the past year as patients go their doctor for a cold but go straight to hospital for suspected broken bones, heart attacks etc. The Alfred usually sends medical problems to the bulk billing clinic opposite.
Education: I would argue that flexible employment policies in the TAFE sector have destroyed technical training in Victoria. Technical teachers need 2 years industry experience before they can teach and TAFE conditions are so poor qualified TAFE teachers who are employed for $60 per hour for an hour on Monday, an hour on Tuesday and 2 hours on Thursday can earn $45 per hour for 40 to 60 weeks elsewhere.
I am not sure the current push for all university lecturers to have PhDs raises standards. It diminishes the undergraduate experience in technical areas. It doesn’t matter at old sandstone universities but it matters at universities with less academically able students.
It pains me to say it, but if your kid wants a technical job they might learn their trade better in the armed forces, if they can survive the discipline, bullying etc
There would be more labour mobility if we introduced what Alan Kohler calls Kangasupa, a default superannuation fund that every worker can join. Superannuation contributions ought to be collected by the ATO in the same way PAYG tax is – a broken Labor 2007 election promise.
Current superannuation schemes make it impossible for older workers to get employment. The employer is unwilling to hire someone who will tap into super in the next 15 yeasr diminishing everyone else’s share.
I love the smell of productivity discussions in the morning. As with all these things, it depends on what you are actually measuring and and more importantly, what your goals are. In essence we can all dig bigger and better holes, but do we need holes to be dug?
With health care, they measure throughputs and outputs, but it is the health outcomes we should be interested in. If we ate healthily, exercised and weren’t so reckless in our recreational pursuits, we would have better societal health outcomes, but due to the overhang in resources allocated to health, productivity in the health sector would collapse.
With Universities, they are there to do research and to teach. Having more people with Phd’s would probably enhace a University’s capacity to engage in research, but doesn’t necessarily lead to the better transference of knowledge to students. Being able to teach, train and engage students in a subject matter is a totally different skill to learning and mastering a specialised subject matter. But if you believe our Tertiary sectyor is just a degree factory with a research component thne it probably doesn’t matter.
Not much of a speech, I thought. I like how he says “All of these reforms I have listed are fairly straight forward” when he doesn’t actually list any reforms – just areas for reform. I guess he knows the specifics would come up against a lot of resistance.
It seems to me that too much of our wealth goes into unnecessary consumption instead of investment – that our productivity would improve by innovation if there were more easily available funds for new innovative startups.
I would also like the government to tax a lot more of the wealth of the wealthy and use it to provide infractructure that would improve productivity. One example: the absurd situation where we have thousands of huge trucks crawling along metropolitan roads, stopped every 100 metres at traffic lights, to get to and from the Port of Fremantle. Either you build a freeway to the port, or much improved rail, or move the port – whatever, it should be possible to improve productivity by investing in better infrastructure.
It’s good to see Martin Parkinson talking more sense than he ever managed when he was at the Department of Climate Change, but then he did have superbly ignorant yet powerful ministers requiring him to further their piffle (Wong, Combet). However it is clear he has yet to wean himself off the climate change pabulum: “Appropriate policies to mitigate climate change at minimum cost also make sense”.
They do not. As Lord (aka Senator, but similar powers to those of a member of the House of Lords) Bob Brown has informed us, he is now in a position to insist on closing all coal mines and thereby ending their shipments of coal to China etc.
If only Lord Brown had been around and had had similar power back in the 1740s in England, how much better a place this world would be. For sure he would have banned the shipment of coal from Yorkshire to London, which already needed one million tons a year, requiring 1,000 ships to convey them. A young miscreant, name of James Cook, embarked on one of them, thereby qualifying for trial at Nuremberg on James Hansen’s charges of high crimes and misdemeanour, but also qualified as a mariner capable of commanding the Endeavour, which led to the very much higher crime of the “invasion” of Australia that has just been denounced by Sidney’s City Council. If only the Chinese had thought to forestall Captain Phillips, how much better off we all would be.
In fact Cook has more than that to answer for at the last Day of Judgment, because the coal he so willingly transported became the bedrock of the Industrial Revolution, Stephenson’s locomotives, and our electricity, the most pernicious outcome of all, but about to be abolished by Lord Brown, with his price for approving the carbon tax being the closure of the Hazlewood power station. We will in future have electricity only when it is sunny and windy – and then just until Brown discovers that manufacture of wind turbines and solar panels requires continuous power embodying CO2. But have no fear, Martin Parkinson’s complete ignorance of economic history ensures he will further all of Lord Brown’s plans for decarbonising our economy. Back to 1740, hooray!
Steve1 has a point about the smell of productivity discussions in the morning John Passant, formerly with the Australian Tax Office, at enpassant says the following
“The wages share of national income fell from 54.5% in June 2009 to 52.7% in June 2010. The profit share of national income showed a corresponding increase, from 26.6% in June 2009 to 28.5% in June 2010.
The wages and profit shares of national income measure the proportion of all income that is paid to labour and capital, respectively.
The wages share of national income is now at its lowest point since December 1964.”
Isn’t ‘increasing productivity’ just economyst-speak[sic] for cutting wages?
Is increased productivity needed anyway? There’s plenty of money, but too much of it is locked up in tithes to banks to pay interest for non-productive, price-inflated real-estate.
(which was root cause of the whole GFC, don’t forget).
eHealth: The implementation of eHealth was held up by the West Australian Premier’s failure to sign the health agreement at COAG 2010.
So what? eHealth had been successfully trialed in 3 areas of Australia, inner city, remote and rural. The inner city pilot zone was south eastern Melbourne which means that when a patient presents at emergency the doctors have access to previous blood tests, imaging, do not resusitate requests. Without eHealth the doctor must rely on the patient to remember to tell him all relevant information. Is the patients memory accurate and can the patient assess relevance? It takes time to take an accurate patient history.
The Austin hospital is trialling Do Not Resusitate protocols that patients can sign up for. If a patient has to be hospitalised and the hospital that has the Do Not Resusitate order is on bypass then the accepting hospital will revive the patient regardless of patient’s wishes.
From a practical point of view when a patient is in the last few months of life they attend the medical specialists with their box of current medications and their pile of X-rays, CRT scans etc. A 4 inch pile of medical images is weighty and the medications get lugged around in a bread bin. The patient’s escort has to be strong and fit to lug this stuff around.
Martin Parkinson said…
This is complete nonsense.
Our ability to produce knowledge based exports competitively is being completely and irrevocably destroyed by the strength of the currency. It was hard enough to out-innovate American, European and Asian competitors previously, given their much larger populations and intellectual resources. With the dollar above parity, and apparently heading higher, it is now impossible.
There will be no more Cochlears, CSLs or Resmeds. We have become a quarry for Asia.
There will be no more Cochlears, CSLs or Resmeds.
Wanna bet?
@4
“Current superannuation schemes make it impossible for older workers to get employment. The employer is unwilling to hire someone who will tap into super in the next 15 yeasr diminishing everyone else’s share.”
WTF?!
Name a superannuation fund strcuture where one individual shares in the account balance of another?
Defined Benefit – nope!
Contributions based – nope!
Billie – please please please explain.
Don’t pin the failings of the Health system on WA. If it was such a good agreement all the others could have signed off and gone on their merry way and left WA behind because we are such luddites.
Robert, that’s exactly what I thought when I saw that headline. Typical ABC to completely misunderstand what productivity is all about.
OK, Occy I am talking perceptions here. There is high unemployment rates amongst older job seekers. Although they are good enough for contact and casual work they are not considered for permanent positions. It has been mooted that young bosses are uncomfortable directing older workers, there may be fears that their parts are wearing out. A 50 year old is likely to get shoulder problems on a factory production line.
The government wants to raise workforce participation rates in the over 50s from 56% to 60%.
Sam @12: Sure.
As for productivity growth … well, what do you expect from a nation that’s sat on its collective ar*e for 10 years rolling in ever more cash from ever more valuable dirt? Its not exactly sending a “be more productive” signal to the labour force, is it?
Meanwhile the currency is forcing non-resource exporters to become 30% more productive in 12 months. That’s simply impossible, so they’re shutting up shop and/or moving what they can overseas.
If you were Cochlear, looking at the long term forecasts for the Aussie dollar, where would you be looking to buy talent and spend your R&D dollars? US-based scientists, engineers and technicians get cheaper every year, Australian ones get more expensive.
Our best and brightest are getting squeezed harder and harder, while the big miners get ever richer and more politically powerful. 21st century Australia is indeed a depressing place to be.
I reckon we can work smarter in IT.
I notice time and time again the young people who work in IT make the same mistakes that people made in the 1960s because despite there being good IT education in Australia since the 1970s people with no experience and no formal qualifications are still allowed to work in IT. So when you hear a former cafe owner turned project manager complaining about how she has to stand over the programmer to get them to deliver working programs you have to ask, why not replace the pesky programmer? Oh, no one better – well revise your specs. Should never have agreed to the impossible.
Likewise I think we need to review the role of employment agencies and their revenue streams. Although the client pays $400 per day for a programmer, if the programmer is Australian they are paid $350 per day, if the programmer is Indian they are paid $200 per day. This pay differential is not conducive to happy work environments and the employment agency favours representing Indian programmers.
The programmer has to have a certain skill level to remain on site, they have learnt to program at school, university or in their bedroom.
Employment agencies: Victorian hospitals have come to rely on nursing agencies to provide casual staff and had got into the habit of have 1 permanent nurse on each ward then hiring casuals at the start of each shift. The hospital boards were mightily miffed when the owner of 1 agency bought the most expensive house ever sold in toorak for $12 million and they established their own nurse bank.
Occy the WA Liberal Premier Barnett refused to sign off the health agreement at COAG.
And all Australians are poorer for the failure to implement eHealth
Billie – the Western Australian government spent millions and mllions of dollars trying to come up with ehealth records – and couldn’t. I note in your example that “the doctors have access to previous blood tests, imaging, do not resusitate requests” which isn’t much really. This is probably a case of productivity versus privacy since it seems people just don’t want a central health record of their prescriptions, mental health issues etc.
The W.A. government didn’t sign the health agreement because of the dodgy way the funding was arranged, but I believe agreement is close now. The W.A. government has been trying to amalgamate many of the numerous small, virtually bankrupt, local governments in W.A. for the last 3 years, and despite obvious productivity benefits, has not won the argument. Productivity isn’t necessarily people’s highest priority.
The point billie makes about the wages share is important.
“The wages share of national income fell from 54.5% in June 2009 to 52.7% in June 2010. The profit share of national income showed a corresponding increase, from 26.6% in June 2009 to 28.5% in June 2010.
The wages and profit shares of national income measure the proportion of all income that is paid to labour and capital, respectively.
The wages share of national income is now at its lowest point since December 1964.”
There is no incentive to invest in upskilling the workforce when the wages share of the economy is being driven down. Productivity is a ratio. Why increase the numerator, improve the productive skill of your workforce, when you can reduce the denominator, wages cost.
There will only be greater productivity when you increase the wages share in the economy and reduce the capital share and in particular, the salaries being paid to the managers & executive classes.
The productivity issue is a failure of leadership. If you reward bad behaviour you will always get more bad behaviour. if we keep rewarding the poor leadership of management we will continue to receive bad leadership.
Robert Bollard@1, that’s an interesting question.
Here’s a productvity suggestion – get rid of a tier of government – the States.
Russell @ 21
“I note in your example that “the doctors have access to previous blood tests, imaging, do not resusitate requests” which isn’t much really. ”
and your experience of the health system is . . . . . . .
I am surprised that WA couldn’t implement eHealth. eHealth has taken more than a decade to implement. IBM & Kodak have been storing images electronically for around for 20 years. Perhaps the historical sandgroper hatred of Victorians has left WA unable to follow instructions written by women. Wouldn’t be the first time in the health sector!
Billie – the issue is privacy and access to the record. Even the mighty Google couldn’t bring it off
When we abolish states and implement a National Curriculum based on the Victorian standard sandgropers might be educated enough to be able to implement eHealth. Not sure what the relevance of Google is?
A sick patient presenting at emergency is more concerned to give their doctor a full record to get the best treatment. I concede that knowing which STDs a patient has contracted might make a doctor chose a less optimum treatment for a patient. But doctors have been chosing which patient gets the best treatment and which patients will get second best forever. Didn’t Sir George Bedbrook at Royal Perth Hospital have the nickname “God”?
Billie – that reminds me of another block along the road to increased productivity. I very seldom go to the doctor but I recently needed some skin cancers burnt off, but I wouldn’t let the GP do it, I wanted a skin specialist to do it. And so I went to the specialist and he picked up the can of whatever is it and sprayed there and there, and out the door I went – $142. Same with teeth cleaning – at the dentist they encourage patients to have the technician clean your teeth. Nope, I will always have the dentist do it. I suppose it would be more productive to have it done cheaper by less qualified people, but I’d prefer to have as much expertise as I can get.
Billie – my Google link isn’t working in LP. It was to this:
http://www.google.com/intl/en-AU/health/about/
and the relevance was that Google saw that all around the world there was a lack of ehealth records and they sought to fill the gap. But obviously they weren’t getting enough takers, and they are discontinuing the service.
Might be shooting myself in the foot . . . .
Increasingly there is concern over the threat of patients presenting to hospitals with drug resistant super bugs.
If your aim is to improve productivity then access to eHealth could alert you to the patients status and the patient is isolated immediately, stopping the superbug infecting other patients and hospital staff.
Is it a patients right to demand medical treatment even when they are highly infectious?
If we had eHealth then it would be harder to prescription shop to build up a supply narcotics unless the patient runs multiple Medicare numbers.
Thanks for the link to Google Health, it looks like it relied on individuals to upload their own information. It wouldn’t be an attractive proposition in countries with eHealth like Brazil.
Although I would not be keen to face the judgement of a Catholic doctor as he read through the list of STDs contracted over my life there might be treatments that are not efficacious on people with a particular health history.
Yes Russell I am also guilty of using my inner urban GP as traffic cop writing referrals to specialists. I wonder if my GP yearns for the stand alone doctoring of former times that is still practised in remote Australia.
Martin Parkinson went wrong right from the beginning with the title, “Sustaining Growth in Living Standards….”
The very wide range of definitions of ‘living standards’ makes the title nonsense. Some of the definitions involve ‘quality’ of life such as leisure, safety, cultural resources, social life, physical health, environmental quality issues etc which in his view of the world wouldn’t even rate as they are a drain on productivity.
I also think that by his definition of living standards we are on average far too wealthy. It’s income inequality which needs to be addressed by firstly ensuring there are enough jobs for those who can work and secondly providing a decent standard of assistance for those who can’t work either from the lack of positions vacant or other reasons.
I think he’s just another Zombie free market economist and cornucopian.
The cover story of the latest BRW “How the rich reduce their taxes .. and how you can too” reminds me that another big potential productivity gain would be in reforming / simplifying the tax system .. another task for government, not us.
No, not exactly . . .
Basically the world is going to hell in a handbasket quicker than anyone thought. And while a few (foreign owned multinationals) have ‘done well’ from minerals, non-mining sector ‘workers’ are going to need something to do and fast.
I figure China would still buy coal and stuff from us, if Australians owned the mines.
Steve @22,
Productivity is a measure of how many workers it takes to produce something, not how much you pay them. Paying lower wages does not increase productivity. Indeed, the reverse is true: increased productivity leads to higher wages.
Incurious and Unread, I think
increased productivity ==> increased national income
which is shared between labour wages and owners profit
Robert Bollard @1 asked “Am I the only one who finds it worrying that a senior public servant is making speeches about policy?”
I’m not worried – perhaps they have always made such speeches to certain audiences, but the rest of us didn’t know. Now, because of the internet, we can all know it. I see it as a ‘transparency’ issue – we pay a lot of money for these people’s expertise, so I’m happy to be able to a) see their biases, and b) know what kind of advice they are giving the government.
Should they be talking policy? Yes, because presumably they’re expert in the area. If the government takes other factors into account (economic, political etc) when making a decision, fair enough, but I would like the benefit of hearing from an expert in the area.
Of course this might be naive – maybe the person was chosen for their views rather than knowledge. But I remember that when I was growing up we had a Director General of Education who had been there for years – everybody knew his name, nobody knew the Minister’s name – who seemed like the headmaster of the whole state. He spoke with the authority of his knowledge and experience, and I think people were more interested to know his views than the Minister’s.
Speaking of health, I have to say I’m on side with the labour market deregulators when I hear that, for instance, for a nurse to move hospitals, they often need a new police check that takes up to a month. I completely fail to see how that sort of thing can be anything but a burden on productivity.
@wizofaus, it seems odd to conflate the requirements of certain institutions that their staff all pass a police check with the broader notion of labour market regulation.
I’m certainly very happy to have staff treating me in hospitals not being on the sexual offenders register or any of the other records that a police check scrutinises. Since there’s no guarantee that somebody hasn’t offended since their last police check, then it seems to make sense for a new employer to check again.
I read his speech last night and it seems to me that the ABC headline is probably what he means, because the content of what kinds of policies will magically reverse this lagging Australian productivity are not really spelled out beyond the usual nostrums to, er, increase productivity. Looking at his ideas (second last section of the speech):
(1) Don’t unwind the neoliberal reforms we already have
(2) Continue neoliberal Budget balancing where surpluses are only there to be spent on stabilising capitalist crisis and paid for by cutting services
(3) Don’t slip back into protectionism
(4) Good old microeconomic reform — that thing that, er, once again, er, increases productivity (oh, yes, at workers’ expense).
Nothing new here, just a request that we get back to giving the working class a shellacking like we did in the previous rounds of reform so that we can be… that’s right, more productive. No wonder George Megalogenis was so warm about the speech this morning on Insiders.
Here’s The Australia Institute’s response, which argues the problem lies in part with the collapse in mining industry productivity (sorry, no link to that as TAI site is currently down).
From the country’s point of view what really counts is the real growth in the production of goods that actually contribute directly or indirectly to our quality of life. Increases in “productivity” are only important to the extent that it contributes to this real growth. If improvements in productivity simply mean that fewer workers are producing the same total production then nothing is gained. In fact we have lost because, if anything, increased unemployment doesn’t really help our overall quality of life.
We often hear praise for our productivity gains during the Hawke/Keating era. Some of these gains were real in the sense that they were the result of the elimination of restrictive work practices. However, some of the gains came as a result of replacing less productive workers (often with lower mental and physical aptitudes.) with more productive workers.
To make matters worse, jobs that could be done by people with limited mental/physical aptitudes were merged with jobs that these people were unable to do. As a result, the percentage of people who were considered “unemployable” grew even when the work they could do was still there as part of a broader job.
Part of the problem here is that productivity is calculated on the basis of hours worked rather than available hours. “Available hours” includes the extra hours that the unemployed and under-employed would like to work if suitable work was available. In the cases mentioned above, the “productivity growth” that was driving increases in unemployment would look far less impressive.
The definition of “available hours” is worth talking about. For example, there may be a case for including the disabled in this calculation since this creates pressure to look hard at what could be done to allow the disabled to make a greater contribution to the economy.
The definition of “production” also deserves discussion. At the moment, unpaid work doesn’t get counted even though it often contributes more to society than some of the paid work that is counted>
tigtog, so you’re saying you’d prefer to be seen to by a nurse that’s recently moved hospitals rather than one that’s been there for many years, just because they’ve had a more recent police check? I’m just pointing out that there ARE examples of inefficient labour market regulations (*), regardless of your political bent. Having the luxury of working in a sector where the balance of power between employees and employers is reasonably even, I’m used to very flexible employment conditions, and I often find myself wondering why other sectors can’t find a way to make this work to everybody’s advantage.
(*) Admittedly I don’t actually know if this is dictated by legislation, but in the context of public hospitals, presumably it is. As it is, I have no problem with the requirement of police checks, but it should surely be at the point nurses obtain their certifications, potentially renewed every so often, but there’s no excuse for it holding up their ability to quickly find new jobs. Allowing employees to easily move to the jobs that they can be the most productive in is, to my mind, a key factor in ensuring a happy, productive labour force.
John D – “If improvements in productivity simply mean that fewer workers are producing the same total production then nothing is gained”
Except historically that has translated to workers being able to work less hours to generate a better standard of living – one only needs to look at the sort of hours people worked 100 years ago and the subsequent standard of living this provided to see that. Having said that, for whatever reason in the last decade or so that trend seems to be breaking down, and for a significant percentage of the population, the average work week now is longer than it was 10 or 20 years ago, with not all that much to show for it (indeed, in the US, for some sectors that has accompanied a slight drop in the standard of living).
In principle, if productivity gains were spread evenly, in 50 years time everybody could enjoy a good standard of living working as little as 20 hours a week, in almost whatever job they felt most suited them. But without a significant change in attitudes towards work and income redistribution, I don’t see it happening.
wizofaus, I believe teachers (as an example) have to get their police checks redone every few years (prepared to be corrected by someone who knows for sure, btw), so it should be possible to do the same thing with nurses. After all (in SA at least) they have to renew their registration periodically, so the check could easily be included in that process.
@wizofaus
No, and please don’t put words in my mouth. Nurses move hospitals all the time, so I would actually have no problem at all with seeing any nurse either newly employed or long-employed at any particular hospital – that’s what professionalism means.
All I know of this alleged problem with nurse mobility is that you have an anecdote about it. What I do know from many years of working in hospitals (albeit twenty years ago) is that most nurses will need to work out a month’s notice at their current hospital before shifting to a new one anyway, so I fail to see a major problem in a police check taking a month to complete.
Agency nurses (which many hospitals rely upon to fill temporary staff shortages (and longer ones during hiring freezes)) have to be certified as passing such checks by the agency supplying them. As DI(nr) indicates, there is probably also a condition for having checks redone every few years, but since this is a relatively new requirement some nurses who have been in one place for ages may not have previously had to have checks done yet, so only a move to a new hospital prompts it for them. Give it a few more years and any such problems will have been resolved as everybody is rolled into the regular re-checks system.
Tigtog, in this particular case it’s someone I know very well, and she’s starting work at a new hospital in addition to her existing role due to change in the rostering. In principle (and certainly if it were the IT industry) she could start next week. In practice she will have to go at least 4 weeks without full pay. I hope you’re right that it’s the sort of problem that’s likely to be resolved in a few years, but it just struck me as a situation that I couldn’t imagine arising in most industries.
Comparing the IT industry with its superabundance of contractors with other industries where people have more traditional employment agreements, especially as members of a registered profession, is bound to get all apples and oranges in short order, don’t you think?
IT does rather tend to treat its personnel as interchangeable plug and play units. It’s not the only industry to do so, but those who rely on registered professionals tend to do somewhat otherwise due to the need for allowing for compliance with professional standards/ethics etc required for registration.
tigtog@48: Comparing the IT industry with its superabundance of contractors
Wasn’t one of the complaints that hospitals have gone down that path too? One “permanent” nurse with a bunch of contactors? I see that as an argument that IT is a good comparison industry. The relative pay rates are are different discussion.
I have noticed that much of Melbourne IT seems focussed on “work harder, not smarter” and uses “bums in seats” as a major metric for productivity. I’m sure it’s coincidence, but wages are also lower than in Sydney.
I think the super-abundance of contractors right across the board creates problems when it comes to the ‘work smarter, not harder’ ethos.
There is also a super-abundance of people [read: baby-boomers] with old-fashioned management styles who treat contractors as simply hirelings, without considering approaches that may incentivise better outcomes. Any contractor that dares to offer suggestions about how work could be done more efficiently or effectively is arrogant/egotistical/uppity. Younger managers seem extremely procedure focused and will sacrifice outcomes simply to get through their [rather arduous] paperwork requirements – the checks and balanced required when core services are outsourced to a contract labour force.
I’ve reduced my work-load in the last 12 months, and indeed have completely changed the focus of my business away from growing a work-force simply because I’m sick to death of the paperwork churn to legitimise dodgy ‘more is better’ – management action targets being privileged over delivering better practical outcomes. Maybe one day they will work out what metrics they need to gather to deliver a ‘better is more’ action target. I wont hold my breath.
“IT does rather tend to treat its personnel as interchangeable plug and play units”
You say that as though it’s a bad thing
But I think I can honestly say I’ve never seen a situation where legislation would have been the sensible way to protect IT workers from questionable employment practices.
Unions were formed to protect workers from explitive work practices. IT is the least unionised industry, and it shows
Robert Gottliebsen’s view at Business Spectator
Billie, that seems to be backwards..surely the fact that there’s so little unionization is a good indication that employer-employee relations are generally pretty good. I’ve been in the industry close on 20 years now and have seen very little to suggest otherwise.
wizofaus @54: Alternatively, the explanation lies in the fact that the industry has grown exponentially in an era where private sector unionisation has been weak in most greenfield industries. It’s more a reflection of the weakness of Australian trade unionism. I personally know people who have tried to unionise IT companies in the face of stiff employer resistance and am aware of at least one USyd honours thesis in Political Economy that’s been written on the issue.
All the stuff said @50 and elsewhere on this thread is basically a symptom of the hidebound management style that is prevalent in this country and especially in the ITbusiness interface.
And treat people like humans, surprise surprise they are usually pretty productive.
Treat ‘em like interchangeable services, they decide that you suck.
It’s not very hard.
I’m inclined to agree with wizofaus although it perhaps depends on who your employer is and the field that you work in. But personally I’ve met very few people in the private sector in IT who think that having a union presence would help improve conditions. A few have tried to convince others that unionisation would help, but have had trouble finding many people that agree with them.
Also, I’m in the union (APESMA is the union for computer & engineering professionals)
Indeed, Tyro @ 56.
I turn down more work that I take on at the moment, you’d think that there was a surplus of contract labour out there for what I do with the way managers conduct themselves. I have two really great clients who I know have more work if I wanted it, but I try to have no more than 1/4 of my work with any one organisation because managers are also pretty transient these days, and if a good one moves on, I don’t want to get stuck in a rut with some idiot. I’m not in IT obviously, but I can’t see unionisation helping in my field either – it’s not a matter of poor working conditions.
Wizafaus @44: You say:
In the 50 years since I started work I would have thought people who could get the work were working longer hours.
The “productivity” gains in the nineties split the country into those who were working more hours than they wanted and those who were getting less. If we had had a worksharing system that worked the productivity gains could have improved our quality of life. For far too many the opposite was the case.
Maybe this needs a new thread, but anyhow…
Tyro, if you’re suggesting that there are a significant number of IT managers that treat employees in the manner that, say, factory managers used to treat their workers in the early 20th Century, then the question is what is it about IT workers that would make them unlikely to want to form unions to combat such treatment, which is what the eventual reaction was in most industries 100 years ago.
Personally, I go out of my way to make sure that I provide an ‘interchangeable’ service’ – documenting what I do, using recognized technologies, maintaining good communication with my team etc. But my managers obviously see the value in this, and even though in principle they could swap me out with someone from India that would charge 1/4 of the fee, our company has, if anything, recently moved to hiring more expensive employees on the basis that they obviously believe they’re getting what they’re paying for.
But John D, sharing the working hours is EXACTLY what we did – almost a third of workers are now part time, and the choice of what hours to work has never been wider (remember how once it was 40 hours a week or nothing?).
As I’ve argued elsewhere Australia has the widest distribution of working hours in the world, and that widening has mainly been driven by changing workers’ preferences over a long period. Most overwork is voluntary (so called “unpaid overtime” is paid as part of the overall wage package), and there is little evidence that underemployment has got worse since the 1980s.
dd: Flexible hours may make it easier to implement worksharing but it is not worksharing. Worksharing means that a conscious effort is made to share the available work including sharing it with people who are unemployed. There are sometimes cases where a group of current employees agree to share to avoid someone having to lose their job during a downturn. I am not aware of a group agreeing to reduced hours so an outsider can get a job.
In some cases unpaid overtime is worked because of dedication and/or real interest in the job. However, it tends to grow when there is a shortage of work because people see it as a way of making their jobs more secure. This has been accompanied by a trend to make more and more jobs salaried jobs where all the overtime is unpaid.
Personally I prefer to be paid by the hour because it allows me to finish work when I have finished a particular task, keep working when I am on a roll and leave early to do something specific without having to feel guilty.
John D, that’s classic “lump of labour fallacy” stuff (google it). Your working less would not create a job for someone else.
There are never a fixed number of jobs to be shared among the population. We create and destroy jobs at a tremendous rate (over 3 milion a year in Oz), and the number of jobs at a given time is just a product of the balance between that creation and destruction. The wonder is not that the total number employed varies, but that the balance of the flows is so fine tuned that the stock is relatively stable.
The rate at which jobs are created and destroyed, in turn, is a product of a complex set of interactions between demand conditions, hiring and jobsearch (“search”) costs, individual productivity, and labour costs. You can only change the number of jobs by fiddling with one or more of these.
As there’s no fixed pool of jobs to share, employers and employees would usually both be giving up a lot of flexibility in entering such arrangements (what happens if someone leaves?). Instead of explicit voluntary arrangements we have let the implicit, impersonal, imprecise but very powerful invisible hand of the market change the distribution of working hours in line with changing preferences. This has had the same effect as voluntary job sharing to meet those preferences, without the coordination difficulties.
wizofaus@61
I do all that but there is no possibility of anything I do being “interchangeable” with just anyone. Analysis and design talent, the ability to see a problem and find an innovative solution to it is essentially a creative act, no amount of documentation can make up for a lack of it. When someone says something like “it will only take a day to do that” the answer is, “well, yes, a day and 20 years of experience”.
There’s several very good reasons why outsourcing software development of business IT systems (especially offshore) does not generally work, and one of those is that there’s actually no difference between a business IT system and the business it supports. Although that’s my specific area of professional expertise, I reckon its not a lot different for IT operations either.
The problem as I see it, is that many companies’ middle management don’t want innovative solutions (or even solutions, per se). They ‘manage by contract’ (you signed off on X, this is X, therefore X is what was and is needed).
How many times I have had conversations that start with “we need a database” or “we need a SOA” or whatever and when you ask the question; “what is the business goal?” you quickly discover they need no such thing.
The first part of your post, I agree. Perhaps IT workers see themselves as part of a ‘profession’, i.e. white collar, the concept of unions being a ‘blue collar’ approach to the issue of organisation.
DD: With all due respect “the implicit, impersonal, imprecise but very powerful invisible hand of the market change the distribution of working hours in line with changing preferences.” Has kept official unemployment over 4% for over 30 years and the real unemployment rate over 10%. Hardly a stunning result compared with the unemployment levels we enjoyed when I entered the workforce in 1960.
I appreciate that there are often practical issues associated with worksharing. Some jobs don’t share well and adding/subtracting jobs when only a very limited number of people with a particular skill are in a work group may not be practical.
However, part of the problem is that employers get the benefits of working fewer workers longer hours while not having to pay the costs that result from more people being pushed on to welfare. Part of the problem is that workplace agreements are voted in by those who have a job, not those whose chances of getting a job are reduced by the agreement. So I often saw agreements that resulted in the people who stayed getting more pay for longer hours and those leaving getting generous redundancy payments. The cruel thing was that the experienced workers who left would get jobs that others with little experience would have got.
Part of the problem too was that overtime penalties have increased. The drillers I worked with in 1960 got a 25% overtime loading. Now they would probably get 50% or double time with an extra meal break in the middle. People are not going to give up work at double time so that someone they don’t know can get a job.
It might help if the government charged a welfare levy on companies that are working people long hours when unemployment is high. It might help if there were penalties to discourage companies from letting people not take their holidays. It might help if the RBA wasn’t adjusting interest rates to maintain the chronic high unemployment rates. It…….
I have great sympathy with John D’s position about the change since the 1960s — the working class is considerably worse off than during the long post-WWII boom. But I find the arguments here about job sharing a little frustrating because it seems to me they start with the symptoms rather than the problem.
I think the key issue is that the long boom was so strong it allowed both massive expansion of the system and rising living standards for workers. And it lasted a long time (with even brief recessions barely upsetting an unemployment rate that was around 2 percent). Since the 1970s we’ve had higher unemployment, a long period of real wage cuts in the 1980s and until recent years perpetually rising labour productivity meaning that real wage rises fell behind returns to capital. Despite all this, there has been no return to anything remotely like the 1960s.
Job sharing will only spread the relative misery among workers rather than challenging the structural limits capitalism finds itself suffering. And let’s not forget that we’re having this discussion at a time the global economy faces more uncertainty than any time since the 1930s. Capitalism is simply unable to deliver the growth it previously did (even if that post-WWII period was the exception rather than the rule in capitalist growth patterns).
The ABC reports that
This is part of the productivity problem. Relative demands change all the time but we have a system that makes it difficult for graduates in one area to respond to demands in another area. There are too many artificial barriers. There are too many employers who have got used to being able to get exactly what they want instead of employing people who could easily be trained to do the job.
In my area (mineral processing) there is no particular reason why someone with a technical degree cannot start being useful within a short time of starting work and pick up most of the rest required for a specific site within months. It certainly doesn’t require a year or two extra at a university. Accountants with the right aptitudes would take longer but their computer and analytical skills could be used straight away.
“There are too many accountants and too few engineers.”
That suggests to me there are too many kids going into uni trying to do degrees they *think* will be useful in getting a decent-paying-but-not-too-challenging career. Accountancy degrees are the sort of degrees that probably count for little if you’re being assessed for a job in any other field where the prospective employer just wants evidence that you have the critical thinking skills, communication abilities, self-descipline, adaptability etc. etc. that’s likely to come from a broader degree (of which engineering is probably a good example).
(Which is not to say that I don’t agree with John D that employers are part of the problem…you only have to see how absurdly specific some job requirements are on seek.com and the like).
Wizofaus: Part of the problem is that it is difficult to predict what the relative demand is for various professions in four years it takes to finish a degree. The problem is not helped by universities and faculties that are trying to build their business rather than trying to match future demand.
In terms of education for work the key skills required for dealing with a changing world are knowing how to learn, how to deal with new concepts and how to solve new problems. If you have these skills you should be able quickly pick up what you need to know/be able to do to satisfy the needs of a specific job. This suggests a tertiary system where school leavers spend a number of years studying a small number of subjects they are interested in at some depth followed by a period getting on top of the “really need to knows” for a broad profession (such as process engineering.) At his point it may be appropriate to pick up some of the specifics for a particular area of employment (such as coal processing engineer.)
Our education/testing system is particularly clumsy at helping people who find that the demand for particular professions has dropped.
For example, I was retrenched when I turned 50 after years of working in iron ore and manganese. My problem was that there were only three jobs in the country that needed my particular skill set. What I needed was a competency test that would allow me to convince people I was competent for a wider range of jobs. I didn’t need a course since I was quite capable of finding the information required to pass the test if I knew what would be tested. At 50, a university would probably have insisted I do a whole degree to qualify me to work in another field.