Category: Employment & work

Why is opinion on migration changing?

~ Andrew Norton ~ 6 Comments

The Age yesterday reported claims that comments former Immigration Minister Kevin Andrews made last year about the reasons for slowing the African refugee intake led to more hostility towards Africans:

…
following Mr Andrews’ comments the NSW Immigration Department [sic] received reports of racial harassment directed at the African community.

“On 14 November 2007, the (deleted) reported that anecdotal evidence suggested an increase in racial harassment directed at Africans in the Parramatta area,” the department-in-confidence community update says.

As is usually the case with these claims, there is no real evidence here of either cause or effect. My own view is that politicians have little influence on subjects people can make up their own minds about. But what politicians say, and reactions to their comments (usually very heated where ethnicity is concerned), do alter the salience of particular issues. It is possible, though not very likely, that greater public discussion of the problems of African migrants had negative consequences for them.

But we can say that there is little sign in survey evidence that particular issues to do with African migrants, relating to gangs and crime, have had any influence on overall public opinion.
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The views of Liberal defectors

~ Andrew Norton ~ Leave a comment

The SMH had a report yesterday on the results of the 2007 Australian Election Survey. It comes up with the following unsurprising findings:

? Industrial relations and global warming were the biggest vote-changing issues.

? Rising interest rates did not cost the Coalition as dearly as thought.

? Voters respected Mr Howard but were virtually in love with Mr Rudd, giving him the highest “likeability” rating in the survey’s 20-year history.

? Low-income battlers moved decisively back to Labor.

? The Coalition would have struggled under Mr Costello.

But the article doesn’t make use of a useful question in the AES, on which party the respondent voted for in 2004 (with a caveat, of course, on the reliability of 2004 memories). This question can be used to sort the views of people who defected to Labor in 2007 from those who were Labor voters anyway.

When we compare people who switched from Liberal to Labor between 2004 and 2007 with those who remained with the Liberals we can see that the former group was more anti-WorkChoices. Of the 19% of 2004 Liberal voters who voted Labor in 2007, 80% disapproved of WorkChoices. Only 23% of those who stayed with the Liberals disapproved of WorkChoices.
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Why taxi fares are high and taxi driver wages low

~ Andrew Norton ~ 21 Comments

I don’t often agree with The Age‘s campaigning journalism, but I thought they picked the right cause – if not quite the right argument – in their advocacy this morning on behalf of taxi drivers. The paper led this morning with the heading:


Assault
Abuse
Fair evasion
12 hour shifts
Poor security
All this for $8 an hour

For the benefit of interstate readers, on Tuesday night a taxi driver, like many of them an Indian student, was stabbed by a passenger (who thanks to the cameras installed in cabs was arrested by police within 24 hours). At last report, the driver was still in a serious condition in hospital.

Drivers responded by blocking a major city intersection, eventually forcing the state government to agree to security screens and pre-paid fares late at night.

Though an analysis piece and an editorial did refer to the licence system in the industry, they did not draw the obvious conclusion that it is to blame for the miserable earnings of taxi drivers, despite the seemingly high fares paid by passengers.

The CIS has a long history – though one unfortunately without policy success – of criticising taxi regulation. One of its earliest publications, by Peter Swan in 1979, was a critique of regulation of the Canberra taxi industry. This was followed by articles by commenters on this blog, Jason Soon in 1999, and Christian Seibert in 2006.
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Can business students do their sums?, #2

~ Andrew Norton ~ 5 Comments

Last year, after the federal government let universities increase annual student contribution amounts for commerce and economics students by $1,200, I predicted:

Applications for business degrees will not move outside the normal +/- <1% market share we see for most disciplines each year.

The basis of my prediction was that applications are primarily driven by interests, and that while financial factors can influence course choices within the range of a person’s interests, these financial factors will not just include course costs, but the anticipated long-term costs and benefits of a particular course choice. Business and economics students, even more than other students, are likely to be able to do their sums and realise that $3,600 in additional course costs is trivial compared to the long-term earnings gains they can reasonably expect.

Damien Eldridge wasn’t so keen on my analysis, pointing out (correctly) that what mattered here was the marginal economics and commerce student, and that a shift in relative prices could see some move to other disciplines that interest them. He suggested that they might go to geography or sociology.

The applications data for 2008 was released today, which shows that my prediction was correct but also reports numbers consistent with Damien’s analysis. Management and commerce did lose market share, by 0.31% of all applications. As usual, no discipline gained or lost by more than 1% market share, demonstrating the high year-to-year stability observed in this data, despite occasional shifts in relative prices. The broad discipline cluster that includes geography and sociology gained 0.43%. Engineering draws on similar quantitative skills to commerce, and many engineers end up as managers, so I think this would be another (and perhaps more likely) alternative course, and it gained 0.53% of market share. Continue reading “Can business students do their sums?, #2” →

Do we have too few graduates?

~ Andrew Norton ~ 20 Comments

No matter how many times Bob Birrell updates his argument that we need more graduates, he gets lots of publicity. This morning was no exception. According to The Age

THE Federal Government should massively increase university places rather than offer 450,000 new training places if it wants to equip young Australians with the skills needed in future, a Monash University study has argued.

Similar stories appeared in the SMH and The Australian.

The basic argument goes like this: there is strong employment growth in managerial, professional and associate professional occupations. However, growth in university commencements has been much lower, and even fell in a few disciplines between 2002 and 2006. Employers have had to use migrants to fill vacancies. Therefore we need more graduates.

However, on closer examination of the evidence the argument falls apart. Of these three broad occupational groups, only professionals are truly dominated by graduates. As I noted in my paper on this issue last year (pdf), only about 20% of associate professionals have degrees. Indeed, the category has now been abolished by the ABS and the occupations that it used to cover distributed to other broad groups. Some of them have gone to ‘professionals’ and ‘managers’, but most went to occupations that do not normally require degrees.

Similarly, ABS Education and Work 2007 shows that less than a third of managers have degrees. Presumably many of them are in small businesses. Perhaps they would be better managers if they had degrees. But we cannot assume that a growth in managerial positions will require an equivalent number of graduates. Even among professionals, 30% don’t have degrees.
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Does paid work undermine the university experience?

~ Andrew Norton ~ 11 Comments

In January I was sceptical, based on studies of student work and academic results, that increasing Youth Allowance to reduce work hours would pay academic dividends.

The first results (pdf) from the Australian Survey of Student Engagement reinforce the conclusion that the average 15 hours a week that undergraduates work for money is not a cause for concern.

The ASSE is based on a questionnaire (in the pdf above), with the questions grouped for analytical purposes according to six scales: academic challenge, active learning, student and staff interactions, enriching educational experiences, supportive learning environment, and work-integrated learning.

It found that, with the exception of work-integrated learning, only those working more than 30 hours a week off campus showed lower results in the various scales. For work-integrated learning those working more than 30 hours did better. Working on-campus was consistently a benefit.

The main reason, I suspect, is that the student lifestyle typically isn’t that busy by the standards of the professional and managerial jobs most students are headed towards. The ASSE finds that more than half of students report spending less than 10 hours a week preparing for class (unfortunately this question is a a bit ambiguous – the prompt is ‘studying, writing, doing homework or lab work, analysing data, rehearsing or other activities’ – which leaves it unclear whether essays or major assignments would be included). Say 15 hours in class, 15 hours at work, and 10 preparing for class, and you have a not very stressful 40 hour week.

This is just a summary report of the ASSE. The questions asked would let us create student timetables covering paid work, class preparation, and campus activities, and compare those with self-reported grade averages. It would be a useful addition to a debate dominated by intuition and anecdote to know more about the relationships between these variables.

Yet another student prostitute story

~ Andrew Norton ~ 45 Comments

HUNDREDS of university students in Victoria have turned to prostitution to pay their way through higher education, The Sunday Age has learnt. (emphasis added)

What does the Sunday Age mean it has ‘learnt’ that some prostitutes are students?

A quick search of the files would reveal that this is old news, a repeatedly re-discovered ‘finding’. That a few hundred of Victoria’s 180,000 or so university students are sex workers is no more surprising than that thousands of them are waiters.

As is usual when the media follows up on the student sex workers, they are far more level-headed about it than the people who think it is a problem:

For 18 months Amy has been combining her studies for a science-based degree with evening work in the city’s brothels.

“I’m sure that some people would be shocked at what I do, but in my mind it really is just a job,” she says.

As I have argued in the past, student prostitution is no cause for policy action. Most students work, and if some choose to work fewer hours for more money in less-pleasant jobs this is no cause for concern.

—
Student prostitute stories:

From the Uniting Church – Herald Sun, 10 October 2008.

Work and life in balance

~ Andrew Norton ~ 16 Comments

The 2006 ABS time use survey results were issued today, giving us another chance to review the claims of left-familists that our time needs their regulation.

The ABS classifies time according to activities, but also into the categories of ‘necessary time’, such as sleeping, eating, and personal hygiene; ‘contracted time’, such as work or education which have specific time obligations; ‘committed time’, such as child care, domestic duties and voluntary work, and ‘free time’, what’s left.

All household types record a slight drop in ‘free time’, by 0.5% to 2.1% of the day, between 1997 and 2006. Most household types also saw slight drops in ‘necessary time’. For households with kids, the greatest gains were in ‘contracted time’, with increases ranging from 0.9% for couples with kids over 15 to 5% for lone parents with kids under 15. Except for the latter group, there were also gains in ‘committed time’.

So does that ‘contracted time’ figure mean people are working longer hours? In 2006, the average man who had a job spent 7 hours and 56 minutes at work and 58 minutes on associated travel. In 1997 he spent 8 hours and 3 minutes at work and 60 minutes travelling. In 1992 he spent 7 hours and 53 minutes at work and 54 minutes travelling. (I’m getting the comparison figures from How Australians Use Their Time 1997.) So there is really no trend here. Even the traffic problems constantly in the news are hard to see in these figures.
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The teaching labour market

~ Andrew Norton ~ 43 Comments

Andrew Leigh and Chris Ryan’s valuable paper on school productivity (pdf) received lots of media coverage today, including a page one story in The Australian. They find that numeracy fell over the period 1964 to 2003, and literacy and numeracy fell over the period 1975 to 1998. It is a loss of productivity because we have put more resources into schools but have achieved worse results. In particular, we have spent a lot of money reducing class sizes, though the Leigh and Ryan paper confirms previous research showing that this has no positive impact on test results.

What it does have a positive impact on is the teacher’s workload. Teaching attracts people interested in, by the standards of the professional labour force, a low number of work hours per year. At least implicitly, they have traded-off higher wages for less work. This trend is self-reinforcing, because it attracts to teaching more and more people who would rather have time off than earn more money, and their interests increasingly dominate the union’s bargaining strategy.

The ABS’s school statistics shows a significant decline in the proportion of teachers who are male, and who are likely to think of themselves as family breadwinners. Between 1986 and 2006 the proportion of teachers in government schools who are male dropped from 42% to 30%. The drop was less severe in private schools, from 37% to 33%, presumably because some private schools offer better salaries than government schools.
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Why is father-son intergenerational mobility stable?

~ Andrew Norton ~ 29 Comments

Using data from four surveys over a 40 year period, Andrew Leigh’s latest paper (pdf) argues that father-son intergenerational mobiliity is stable in Australia.

In his conclusion, as reported by The Australian, he says:

“On one view, the absence of any significant rise in inter-generational mobility might be regarded as surprising,” Dr Leigh says in the study report.

“Increases in healthcare coverage, the banning of racial discrimination, the abolition of up-front university tuition fees and an increase in the number of university places are among the policy reforms that might have been expected to increase inter-generational mobility.

“Yet there were also trends in the opposite direction.” These included rising unemployment during the study period and the removal of inheritance taxes in 1979. Dr Leigh said a rise in inequality had been well-documented with the distance between income groups greater in the early 2000s than in the mid-1960s.

I know conclusions are where they let academics off the referee’s leash, but some of this seems a bit odd to me. I’m not sure why improved healthcare coverage would make much difference; in any case claimed ‘disability’ is much higher than it used to be. Nor are bans on racial discrimination likely to have influenced the figures much; such laws are easily evaded and many migrant groups were doing fine long before discrimination was outlawed.

Inheritance taxes, as Andrew L’s own research shows (pdf), took only about 30% of the largest estates – something unlikely to affect the salary data he’s using (though it may affect investment income). And rising inequality is consistent with high mobility (if the poor and the rich swapped places each generation, ie complete mobility, inequality would be unchanged because it is a static, snapshot-in-time measure).
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