Australia’s still surprisingly secure workers

The ABS released their labour mobility survey yesterday, and as I predicted two years ago Labor’s legislated job security provisions, which took effect about five months into the survey, did not stop retrenchments going up.

3.7% of workers who were employed in the year to February 2010 were retrenched, compared to 1.8% under WorkChoices in the year to February 2008. Retrenchment levels have more to do with business conditions than legislation.

While the 2010 result confirms that as a general point, the longer term trends on this in the figure below are quite intriguing. As measured by people being retrenched, the common belief that job security is declining over time is not correct. 2010 was the first negative trend in nearly 20 years. Maybe the long boom has saved more employers from the difficult decision to let people go. Or maybe there are other things going on that make dismissal a less common form of labour market adjustment.