Assessment and recommendations

Job displacement as a consequence of economic restructuring is common in the Australian labour market. Each year, on average during 2002-13, 2.3% of employees with at least one year of tenure lost their job for economic reasons such as corporate downsizing or plant closure. This is a high share relative to other OECD countries with comparable data. The displacement rate surged in 2009 with the global financial crisis (GFC), but fell back to its previous level very quickly. However, with the marked softening of labour market conditions since 2012, the displacement rate increased strongly again in 2013. Some workers are particularly vulnerable to displacement, notably older workers, workers with a low education level and casual workers, as well as workers with short tenure and those employed in small firms.