I created this chart for a column of mine on low job mobility in Australia. Increased labour rights and a very low unemployment rate mean that Australian businesses stopped firing people – the technical term here is retrenchment.

Tools used and process for demographic research are usually pretty simple: I download the source data from the ABS website on job mobility, create the chart in Excel, write my column text, email the finished column text and the Excel data to the publisher, publisher throws data into Flourish.

Posted by simongerman600

8 comments

  1. It costs a lot to hire someone and train them. To the point it is hard to gain employment.

    As a result, unless you are spectacularly bad or costing the company money literally through incompetence, most companies will retain the “dead wood” within reason as some productivity with a known entity is better than investing thousands in a new employee who may be worse.

  2. Probably pretty similar situation in the States. My anecdotal experience only goes back as far as the Great Recession, but for the last decade, and certainly the few years immediately following COVID, labor in the US has had tremendous, and largely unrealized, leverage. We saw some isolated instances of unionization. And individuals charted their own paths, jumping jobs for increased salary. But I personally saw just as many people taking the labor shortage leverage and using it to “quiet quit”, doing just enough to avoid being on a PIP but also not enough to actually do their job.

    That trend is slowly changing, though. Things are starting to cool down, which will mean cuts, and it will take years, or more like a generation, before the pendulum swings back to the conditions we had for labor’s leverage.

  3. >Firing

    >The technical term here is retrenchment.

    You should not conflate these two. Firing and retrenchment generally mean 2 very different things.

    Firing is a problem of the *individual*. It implies the employee performs poorly at their job, and should be fired so that another person can do that job.

    Retrenchment is a problem of the *company*. It implies the *job* the employee was performing is no longer needed, regardless of how well they were doing it.

    In many countries including Australia, there are regulations distinguishing these. Companies may need to pay severance for retrenchments, but not for firings for performance – which must be well-documented.

  4. You see that collapse right after 1980. That was when mortgage rates when sky high after inflation. Everyone was basically trapped in their house because they had low mortgages, but if they moved their mortgage could double or triple. Companies responded by offering poor raises (compared to inflation) because they knew their employees would not leave over a few percent pay and pay double a mortgage.

    This also made hiring new workers and growing hard. The only ones available were the new grads who would have to pay an arm and a leg to get a mortgage. The result is that companies offered large salaries for new grads who just rented in high cost of living areas. Thus was born the “YUPPY.” The result was this weird situation where 24 year olds were out earning their parents but paying 4 times more for rent than their parents were paying for a mortgage. One way this played out was when families would go out to eat the kids making a lot of money and paying a fortune for rent would want to go to a relatively expensive restaurant, while the parents whose salaries had been stagnant, but whose mortgage was basically free would want to go to a less expensive restaurant.

    Anyway, we are going through a similar phase right now.

    A second thing going on is that because of double income households it is much harder to move than before because both spouses are losing a job while only one spouse is getting a new one (at first) so a lot of time it does not make sense. Back in the 60s familes just moved to whoever offered the husband the most money, but now it is not worth selling and buying a house and a wife quitting her job just to increase the husband’s income.

  5. I am unfamiliar with the term “retrenchment”; what does it mean in this context?

  6. The data is a bit misleading, I suspect. I would gather that most companies are running so thin there is not much choice anymore which is why they are so so so eager to get AI into the mix.

  7. you dont have to fire independent contractors. you just end the contract.

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