4160.0 - Measuring Wellbeing: Frameworks for Australian Social Statistics, 2001  
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Contents >> Chapter 6: Work >> Defining work

Defining work

The activities associated with producing the materials, services and infrastructures needed for living, for living well, and ensuring future survival, can be called work. People need to produce or acquire food, shelter, and other basic necessities of life. In order to prosper, families and communities generally want to enhance these basic necessities, produce more nutritious food, build more comfortable, luxurious or secure dwellings, build community infrastructures, and so on. There are many other work activities that sustain human wellbeing, such as those associated with administration, transport, and communication. Families and communities also rely on the effort people put into caring for each other, especially for children, and on the work involved in sustaining natural resources.


While many people provide their own housekeeping services, grow at least some of their own food, or fix their own cars, there are very few who have all the skills, or produce all the materials, necessary to live. Instead, there is extensive division of labour. Some people produce food, others transport and distribute it; some are builders, and others provide communication services. This division of labour enables skill specialisation and thereby contributes to the development of technology. As well, with this dispersal of skills comes the necessity for exchange. Within families, caring services are exchanged freely, but more generally, goods and services are exchanged in the marketplace. In its simplest sense, a marketplace, or economy, is a forum in which the goods or services owned or produced by one individual can be exchanged for the goods or services of another, potentially allowing each person access to the full variety of goods and services necessary for living. The division and exchange of labour tends to contribute to the wellbeing of society by bringing a greater range of specialised goods and services into circulation. In Australia work is often oriented toward market exchange, whereas, in some other countries, higher proportions of people are self sufficient.

There are many other connections between the work people do and the economy. People can exchange work itself for payment, which allows them to purchase goods and services. The exchange of labour for remuneration comprises the 'labour market' - an integral element of the broader national economy. Thus the economy is vitally dependent on work both because it produces the goods and services that are the focus of economic exchange, and because it provides consumers with income to spend. And work-related structures (e.g. wage, occupation or industry structures) are affected by economic interventions. For these reasons, work-related data often simultaneously signpost both the productivity and the welfare of the community. For example, employment and unemployment measures can indicate the contribution of labour to the national economy, but also the socioeconomic status of particular groups, or the wellbeing of regions and communities.

Because of the relevance of work to both social and economic issues, a large amount of effort has been put into defining and measuring work. Traditionally this has focused on work that is directly and immediately linked to economic production. Although household and voluntary work is vital to economic growth as it supports the welfare and growth of the community at all levels, it is not directly connected to the economy in the same way as, say, work that produces food for commercial distribution. Thus household and voluntary work is referred to in this chapter as non-economic work, and work that contributes directly to economic production, as economic work. Economic work mainly includes paid work and work oriented towards market exchange, but may also include work that contributes to people's subsistence (e.g. the home production of food).

People who are engaged in economic work are said to be economically active. Another group that are economically active are those who would like to have paid work but can not obtain it for one reason or another. Because these people are available to contribute to the production of goods and services, but are not able to, they represent underutilised labour. They are economically active because they are an active element in the labour market supply equation. These people are usually defined as unemployed. They are seen as distinct from people who are voluntarily inactive, e.g. because they are retired, or have other activities, such as caring for children, that take up their time. People in these latter situations are defined as not economically active.

Deciding whether a particular activity should be classified as economic is not always straightforward. Some work exchanges do not involve monetary remuneration, yet contribute directly to the production of goods and services, for example, where family members work unpaid in a family business. Work can also move between the economic and non-economic sectors over time and in different circumstances. For instance, the last few decades have seen the movement of various types of unpaid household work such as food preparation and childcare into the marketplace, supporting growth in hospitality and child care industries.

There are also challenges involved in classifying the population into those who are employed, those who are unemployed, and those who are not economically active. For example, people who are substantially retired from the labour force may continue to work now and then. People who have been unemployed for an extended period and gain temporary work may be considered employed in terms of economic activity, but, for social analysis purposes, may be more appropriately included with people classified as unemployed. Many of these conundrums are addressed by the International Labour Organisation's (ILO) labour force framework, which is one of several work-related frameworks discussed in the frameworks section below.

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