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6105.0 - Australian Labour Market Statistics, Apr 2005  
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Feature Article: Health, disability, age and labour force participation


INTRODUCTION

Participating in the labour force is a way of contributing to society and maintaining financial independence. There is often a close relationship between a person's health status and participation in the labour force. A person may be limited by a pre-existing health condition, and so be unable to physically look for work or locate a job that could accommodate their health needs. A previously healthy employee may find that they are unable to continue their work due to a worsening health complaint. Being outside the labour force may have a negative impact on a person's health.


This paper explores the links between health and disability, age, and labour force participation.



HEALTH STATUS AND LABOUR FORCE PARTICIPATION

In general, a higher proportion of long-term medical conditions and disability are associated with age (end note 1, end note 2). The self-assessed health status of people in the labour force also follows this pattern. Self-assessed health status refers to a person's general assessment of their own health against a 5 point scale (excellent, very good, good, fair or poor health) (end note 1).


For those in the labour force, a relatively high proportion report having good or better health, although this proportion declines with age. For example, results from the 2001 National Health Survey (NHS) show that 92% of males and 89% of females in the labour force aged 15 to 24 years reported good or better health compared with 79% of males and 85% of females aged 55 to 64 years who were in the labour force.


While both older and younger people who are participating in the labour force enjoy relatively good health, the self-reported health status of those who are not in the labour force tends to be lower for older people. This difference is particularly pronounced for males.

1. Proportion reporting good or better health - 2001
Graph: Proportion of people reporting good or better health, 2001



Psychological well-being is also associated with labour force participation. In the 2001 NHS, psychological distress was measured using the Kessler Psychological Distress Scale 10 (K10) (a scale of non-specific psychological distress based on 10 questions about negative emotional states in the 4 weeks prior to interview) (end note 1).


While the overall proportion of women who report high to very high psychological distress is higher than that for men, this problem tends to particularly affect men who are not in the labour force. For example, 41% of 35 to 44 year old men who were not currently in the labour force reported high to very high psychological distress compared with 18% of their female counterparts. The reasons behind these results reflect a complex interaction of factors. It may be that those with high to very high psychological distress find it difficult to enter the labour force. At the same time, not being in the labour force may contribute to psychological distress.

2. Proportion scoring high to very high psychological distress - 2001
Graph: Proportion scoring high to very high psychological distress, 2001




PERSONS NOT IN THE LABOUR FORCE

While older people who are not in the labour force are more likely to have a poor self-assessed health status than those in the labour force, this difference is more pronounced for males than females. For example, the 2001 NHS showed that, of 45 to 54 year old men, 44% who were not in the labour force said they had good or better health, compared with 64% of their female counterparts.


Males who are not in the labour force are also more likely to have a disability, and their likelihood of having a disability increases with age. As reported in the 2003 Survey of Disability, Ageing and Carers (SDAC), a person is considered to have a disability if they have a limitation, restriction or impairment that has lasted, or is likely to last, for at least six months, and restricts everyday activities.


People with a specific restriction or limitation may have both a core activity limitation (relating to self care, mobility and communication) and/or a schooling or employment restriction (end note 3). The 2003 SDAC reported that, for males aged 45 to 54 years, 12% of those in the labour force had a specific restriction or limitation, compared with 67% who were not in the labour force.


Females who were not in the labour force also had higher specific restriction or limitation rates compared with those who were in the labour force. However, this pattern was somewhat less pronounced when compared with men. For example, women aged 45 to 54 years who were currently working or looking for work had a specific restriction or limitation rate similar to that of their male counterparts (12%). However, for those women not in the labour force, a somewhat lower proportion had a specific restriction or limitation (38%) when compared with men (67%).


This suggests that the existence of a disability may be a common reason for men not participating in the labour force. The 2003 Survey of Persons Not in the Labour Force (PNILF) found that, for males aged 25 to 54 years, disability, illness or injury were the main reasons for not working or looking for work, with 46% of males in that age group reporting these reasons for not participating in the labour force (end note 4).

3. Disability, Proportion with a specific restriction or limitation - 2003
Graph: Disability, proportion with a specific restriction or limitation, 2003



While disability, illness and injury were the main reasons given for men not participating in the labour force, health and disability status are less strongly linked to women's labour force participation rates, as women tend to have other reasons for not participating in the labour force. Results from the 2003 PNILF show that 76% of women aged 25 to 54 years reported not working or looking for work because they were undertaking home duties or childcare, and only 9% because of their own disability, illness or injury (end note 4).


In recognition of the difficulties that many people with a disability face in entering and remaining in the labour force, governments and community groups have developed a range of services and policies to assist those with disabilities to find and maintain work. These include promoting the concept of equal opportunity, supported by anti-discrimination laws such as the Disability Discrimination Act 1992; (end note 5) the Employer Incentives Strategy with its incentives such as providing funding towards modifications in the workplace, the wage subsidy scheme and the supported wage system; and Disability Employment Services which assist people with moderate to severe disabilities to find and keep work. This assistance includes providing supported employment for those with moderate to severe disabilities in business services which provide support for employees and their families and assist people with disabilities to participate in the community (end note 6).



TIME OFF WORK DUE TO ILLNESS

While rates of people with a disability, or who report fair or poor health, increase more markedly with age for those not in the labour force, this pattern still occurs for those in the labour force. It might be expected that declining health as people age could increase the likelihood of taking sick leave for those in the older age groups. However, this is not the case. The proportion of people taking sick leave remains relatively stable with age for employed males, and decreases slightly with age for employed females.

4. Employed persons, Whether had days off work for own illness(a) - 2001
Graph: Employed persons, whether had days off work for own illness, 2001




CONCLUSION

There is a strong link between health and labour force participation. For those not in the labour force, there are higher proportions of people with disabilities, and lower proportions of people with self-assessed good or better health, when compared with those who are working or looking for work. This pattern becomes more pronounced as people age, and is more obvious for males than for females. High to very high psychological distress is especially evident for middle aged males who are not participating in the labour force.



END NOTES


1. ABS, National Health Survey: Summary of Results, 2001 (cat. no. 4364.0). Back

2. ABS, Disability, Ageing and Carers, Australia: Summary of Findings, 2003 (cat. no. 4430.0). Back

3. ABS, Australian Labour Market Statistics, October 2004 (cat. no. 6105.0). Back

4. ABS, Persons Not in the Labour Force, Australia, September 2003 (cat. no. 6220.0). Back

5. Human Rights and Equal Opportunity Commission (HREOC) 2005. Last viewed 16/02/2005 Back

6. Family and Community Services (FACS) 2005. Last viewed 16/02/2005 Back


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