Australia's other two-speed economy: gender, employment and earnings in the slow lane

Abstract

Talk of a 'two-speed economy' was prevalent in Australia in the first half of 2010. The Australian Chamber of Commerce and lndustry argued against a significant increase in the minimum wage on the basis that most minimum wage earners were employed in the 'slower' sectors of the Australian economy, where employers could not afford increased employment costs. This article considers the recent Fair Work Australia wage decision in the context of the argument that Australia has a two-speed economy. Using earnings and employment data from the Australian Bureau of Statistics, we find that it is possible to identify significantly different patterns to the earnings outcomes experienced within specific sections of the Australian economy. There are some clear 'tracks' particularly between men and women in the private sector. The data suggest that the recent minimum wage decision will play an important role in countering labour market inequities, particularly those that are evident in Australia's gender pay gap. Further work remains to be done, however, and the forthcoming equal remuneration case will provide a further opportunity for Fair Work Australia to contribute to gender pay equity in Australia.