This article was published in the October 2008 issue of Australian Labour Market Statistics (cat. no. 6105.0).

MEASURES OF CASUAL EMPLOYMENT


INTRODUCTION

Over the past 25 years, shifting requirements in the workplace and changing lifestyle patterns have led to a growth in forms of employment other than the 'traditional' arrangement of full-time, ongoing wage or salary jobs, with regular hours and paid leave. These changes have led to a greater interest in the role of casual employment in the workplace, as it is one form of employment where there can be a range of differing circumstances and individual impacts, both positive and negative.

Casual employment may have advantages for both employees and employers. Casual employment arrangements can provide flexibility for balancing work, family, study and other commitments. However, people who are employed as casuals for extended periods of time may not receive the same entitlements as ongoing employees. For example, their working conditions may involve low levels of training, poor career opportunities and adverse occupational health and safety outcomes (end note 1).

Casual employment can be difficult to define and is therefore difficult to measure accurately in a single statistic. Currently, three different measures of casual employment are used in Australian Bureau of Statistics (ABS) household surveys which relate to employees (excluding owner managers of incorporated enterprises). These are:

• employees (end note 2) without paid leave entitlements
• employees (end note 2) who considered their job to be casual; and
• employees (end note 2) who received a casual loading as part of their pay.

The purpose of this article is to provide a brief overview of these measures. It will then compare differences and the overlap between them, using data from the November 2006 Working Time Arrangements (WTA) Survey (end note 3). This survey is currently the only supplementary survey to collect all three measures of casual employment.


OVERVIEW

In November 2006, there were an estimated 8 million people who were employees (end note 2) in their main job. Of these, 4.1 million (52%) were men and 3.8 million (48%) were women.


Employees (end note 2) without paid leave entitlements

It is estimated that there were 1.8 million employees (end note 2) without paid leave entitlements in November 2006. This represented close to a quarter (23%) of all employees (end note 2). Of those employees (end note 2) without leave entitlements, 795,000 (44%) were men and 1 million (56%) were women. Nearly one in five (19%) of all male employees (end note 2) were without paid leave entitlements, compared to 26% of all female employees (end note 2).

The ABS defines employees (end note 2) without paid leave entitlements as 'employees (end note 2) who were not entitled to paid holiday leave or paid sick leave, or did not know whether they were entitled to paid holiday leave or paid sick leave in their main job'.

This measure, 'employees (end note 2) without paid leave entitlements', is widely used, and is considered a proxy for casual employment. However, it has its limitations as it does not fully capture attributes typically associated with casual employment, such as precariousness of tenure and variability of hours and earnings.

In addition, an important issue that affects this and the other two measures is the fact that information collected in the WTA survey, as with other supplementary surveys, uses the Any Responsible Adult (ARA) method (end note 4). This method assumes that the responding member of the household can respond accurately and answer questions on another person's behalf about their leave entitlements, whether they receive a casual loading and their perception of whether their job is casual.


Employees (end note 2) who consider their job to be casual

In November 2006, there were an estimated 1.8 million employees (end note 2) who considered their main job to be casual (representing 22% of all employees (end note 2)). Of these, 726,800 (41%) were men and 1 million were women. About 18% of all male employees (end note 2) considered their job to be casual, compared to 27% of all female employees (end note 2).

These employees (end note 2) are more commonly referred to as 'self-identified casuals', and are defined by the ABS as, 'employees (end note 2) who consider their job to be casual'. Self-identification is the simplest means of gathering information about casual employment, but its subjective nature may be limiting. For example, two people might work in the same type of job with the same arrangements yet, they may have differing views on whether that job is casual or not.

A major limitation of this measure is that people's individual perceptions about their job may not be known to the person responding to the survey on behalf of the household. However, the usefulness of this measure is that it may give some indication of how precarious people feel their employment is.


Employees (end note 2) who receive a casual loading

In November 2006, there were an estimated 1.1 million employees (end note 2) who were reported as receiving a casual loading as part of their pay, which represented 14% of all employees (end note 2) (end note 5). Of the employees (end note 2) who were reported as receiving a casual loading, 461,400 (42%) were men and 644,100 (58%) were women. Of all male employees (end note 2), 11% were reported as receiving a casual loading. In contrast, 17% of all female employees (end note 2) were reported as receiving a casual loading.

The ABS defines casual loading as 'the provision by an employer of a higher rate of pay to compensate for not being entitled to paid holiday leave and/or paid sick leave'. One of the main benefits of using casual loading as a proxy measure of casual employment is that it clearly defines employes (end note 2) through their pay conditions. However, a key disadvantage is that the person responding to the survey (ARA) may not know about their own pay components, or about the pay components of others in the household.

In addition, the casual loading measure relies upon the assumption that casual employees (end note 2) actually receive a higher rate of pay to compensate for the lack of paid leave entitlements, whereas not all casual employees (end note 2) may receive a higher rate of pay.

The casual loading measure of casual employment provides the smallest estimate of the three measures (see Graph 1).

Treatment of the 'don't know' responses in the three measures

A key difference between the three measures is the treatment of 'don't know' responses. What is interesting to note is that 'don't know' responses for whether a person receives a casual loading as part of pay are separately identified in that data item, whereas for the other two measures they are not. In November 2006, there were an estimated 404,500 employees (end note 2) (equivalent to 5% of all employees (end note 2)) for whom it was reported that they did not know whether they received a casual loading as part of their pay.

In contrast, the 'don't know' response is not a valid response for whether respondents consider their job to be casual as people must respond with either 'yes' or 'no'.

For the leave entitlements measure, the treatment of 'don't know' responses is a bit more complex. For each leave entitlement (paid holiday leave and paid sick leave), 'don't know' is a valid response and they are separately identified in the individual data items. However, to determine paid leave entitlements, where a 'don't know' response is not desired, a decision matrix is used. For those who answered 'yes' to either one, or both, paid holiday or paid sick leave, they are deemed to be with leave entitlements. For those that have a combination of 'no' and 'don't know' responses, they are deemed to be without leave entitlements.


OVERLAP BETWEEN THE THREE MEASURES

The following table demonstrates the overlap between the three measures of casual employment. It presents employes (end note 2) with and without paid leave entitlements cross-classified by self-identified casuals and by those who received a casual loading as part of their pay.

2. Measures of casual employment, Employees(a) - November 2006
		With paid leave entitlements	Without paid leave entitlements	Total
Measures of casual employment		'000	'000	'000
Self-identified as casual
	Received casual loading	65.9	855.0	920.8
	Did not receive casual loading	83.9	510.9	594.8
	Did not know	21.9	215.9	237.8
	Total	171.6	1 581.8	1 753.4
Did not self-identify as casual
	Received casual loading	166.7	18.0	184.7
	Did not receive casual loading	5 674.4	183.6	5 858.0
	Did not know	144.3	22.4	166.7
	Total	5 985.4	224.0	6 209.4
Total
	Received casual loading	232.5	873.0	1 105.5
	Did not receive casual loading	5 758.3	694.5	6 452.7
	Did not know	166.2	238.3	404.5
	Total	6 157.0	1 805.8	7 962.8
(a) Employees (excluding owner managers of incorporated enterprises). See end note 2.
Source: Working Time Arrangements Survey, November 2006.

The table above shows that while the three different measures of casual employment are mutually exclusive, there is a large overlap.

Overall, there were 855,000 employees (end note 2) (11% of all employees (end note 2)) who were without paid leave entitlements, who also self-identified as casual and were reported as receiving a casual loading. These people represented close to half of all employees (end note 2) without paid leave entitlements (47%) and self-identified casuals (49%), and 77% of those who were reported as receiving a casual loading.

In particular, there was a large overlap between self-identified casuals and employees (end note 2) without paid leave entitlements. While both of these measures represented nearly a quarter of all employees (end note 2), approximately nine out of every ten (93%) employees (end note 2) who self-identified as a casual were without leave entitlements and 88% of those employees (end note 2) without leave entitlements also self-identified as a casual (see Graphs 3 and 4).

Even though fewer employees (end note 2) reported that they received a casual loading compared to the other two measures of casual employment, there was still an overlap between those receiving a casual loading and the other measures. In November 2006, there were 873,000 employees (end note 2) who were reported as receiving a casual loading as part of their pay and who did not receive paid leave entitlements. This represented 79% of all employees (end note 2) who received a casual loading. There were also 920,800 employees (end note 2) who received a casual loading as part of their pay and self-identified as a casual. This represented 83% of employees (end note 2) who received a casual loading.


CHARACTERISTICS OF CASUAL EMPLOYEES (end note 2)

For the remainder of this article, employees (end note 2) defined as casual by any of the three measures will be referred to as 'casual' employees (end note 2), except where one particular measure of casual employment is being discussed.

Regardless of the measure used to define casual employees (end note 2), all three tend to portray similar characteristics (see Table 5). That is, they are more likely (than all employees (end note 2)) to be female, young and employed part-time.

5. Casual employees(a), Sex, age and employment status - November 2006
		Without paid leave entitlements		Self-identified as casual		Received casual loading		All employees (excluding OMIEs)
Characteristics of casual employees		'000	%	'000	%	'000	%	'000	%
Sex
	Males	795.0	44.0	726.8	41.5	461.4	41.7	4 142.7	52.0
	Females	1 010.8	56.0	1 026.6	58.5	644.1	58.3	3 820.1	48.0
Age
	15-19	205.1	11.4	204.7	11.7	118.4	10.7	401.1	5.0
	20-24	377.5	20.9	369.7	21.1	226.5	20.5	1 042.2	13.1
	25-34	355.7	19.7	338.2	19.3	231.5	20.9	1 937.7	24.3
	35-44	343.0	19.0	336.4	19.2	222.3	20.1	1 887.7	23.7
	45-54	285.3	15.8	280.3	16.0	184.4	16.7	1 726.2	21.7
	55-64	191.5	10.6	181.5	10.4	103.0	9.3	864.7	10.9
	65 and over	47.7	2.6	42.5	2.4	19.3	1.7	103.2	1.3
Employment status
	Full-time employed	633.1	35.1	549.8	31.4	409.3	37.0	5 782.6	72.6
	Part-time employed	1 172.7	64.9	1 203.6	68.6	696.2	63.0	2 180.2	27.4
Total employees		1 805.8	100.0	1 753.4	100.0	1 105.5	100.0	7 962.8	100.0
(a) Employees (excluding owner managers of incorporated enterprises). See end note 2.
Source: Working Time Arrangements Survey, November 2006.

There is a strong link between working part-time hours (less than 35 hours a week in all jobs) and working as a casual employee (end note 2). In November 2006, around two-thirds (between 63-69% for all three measures) of casual employees (end note 2) worked part-time, compared with 27% for all employees (end note 2).

Although young people (aged 15-24 years) made up 18% of all employees (end note 2) in November 2006, they comprised close to a third of casual employees (end note 2) (around 31-33% for all three measures). This is closely related to the relatively high participation of young people in education and their tendency to combine work with study.

The age distribution of casual employees (end note 2) followed the same pattern for all three measures of casual employment, however there were some differences between men and women. Casual male employees (end note 2) were more likely to be young compared with casual female employees (end note 2). Using without paid leave entitlements as an example, over a third (36%) of all male casuals were aged 15-24 years and a further 22% were aged 25-34 years. In contrast, 30% of female casuals were aged 15-24 years and a further 18% were aged 25-34 years.

Graph 6 indicates that for both men and women, employees (end note 2) aged 15-19 years and 65 years and over were more likely to be without paid leave entitlements than all other age groups. However, proportionally more female employees (end note 2) than male, particularly from the age of 30 onwards, were without paid leave entitlements (between 25-30%), reflecting the fact that many women work part time hours to balance work with family commitments. In contrast, most men of this age tend to have full-time ongoing employment arrangements (between 12-16% were without paid leave entitlements).

While women represent less than half (48%) of all employees (end note 2), they were more likely than men to be employed as casuals (between 56-59% of casuals in all three measures were women). This is because women are more likely to work part-time hours to enable them to balance work with family commitments, thus they are more likely to be employed as casuals.

In which industries and occupations do casuals work?

Casual employees (end note 2) are over represented in particular industries and occupations. Generally, the industries and occupations in which casual employees (end note 2) work are those which offer jobs that are part-time and jobs that require lower levels of skill.

While casual employees (end note 2) accounted for less than a quarter of all employees (end note 2), all three measures of casual employment indicate that casual employees (end note 2) were overrepresented in the Accommodation and food services industry in November 2006. Of those employees (end note 2) working in this industry, 56% were without leave entitlements and 57% were self-identified casuals. Employees (end note 2) receiving a casual loading represented 32% of all employees (end note 2) in the Accommodation and food services industry.

Other industries with high proportions of casual employees (end note 2) were Agriculture, forestry and fishing, and Arts and recreation services. However for those who reported receiving a casual loading as part of their pay, the Retail trade, and Administrative and support services industries had higher proportions of these types of casuals (24% and 20% respectively) compared to the Agriculture, forestry and fishing industry (17%).

The Electricity, gas, water and waste services industry and the Financial and insurance services industry were least likely to employ casual staff. Based on the three measures of casual employment, less than 10% of employees (end note 2) in those industries were employed as casuals.

7. Casual employees(a), Industry - November 2006
		Proportion in each industry
	All employees	Without paid leave entitlements	Self-identified as casual	Received casual loading
Industry(b)	'000	%	%	%
Agriculture, forestry and fishing	128.8	46.5	46.0	17.4
Mining	125.1	9.7	8.4	7.9
Manufacturing	861.3	16.3	16.1	11.2
Electricity, gas, water and waste services	99.4	8.0	5.9	*5.3
Construction	544.3	24.3	18.5	9.3
Wholesale trade	337.8	14.2	13.2	6.9
Retail trade	894.9	35.8	36.9	24.4
Accommodation and food services	475.7	55.9	56.8	32.3
Transport, postal and warehousing	379.7	22.9	22.3	14.2
Information media and telecommunications	214.8	17.4	16.0	11.7
Financial and insurance services	339.8	7.1	6.3	4.4
Rental, hiring and real estate services	131.6	24.1	21.6	10.6
Professional, scientific and technical services	520.2	14.5	11.7	7.0
Administrative and support services	232.8	39.7	37.8	19.7
Public administration and safety	603.6	9.0	8.4	7.2
Education and training	717.0	16.9	18.7	12.4
Health care and social assistance	955.3	19.4	19.0	15.3
Arts and recreation services	125.5	44.5	43.4	22.8
Other services	275.3	19.5	19.8	10.1
Total employees	7 962.8	22.7	22.0	13.9
* estimate has a relative standard error of 25% to 50% and should be used with caution
(a) Employees (excluding owner managers of incorporated enterprises). See end note 2.
(b) Industry is classified according to the Australian and New Zealand Standard Industrial Classification (ANZSIC), 2006 (cat. no. 1292.0).
Source: Working Time Arrangements Survey, November 2006.

All three measures indicate that lower skilled occupation groups had higher proportions of casual employees (end note 2) than the higher skilled groups. Close to half of employees (end note 2) who were Labourers were without leave entitlements or considered their job to be casual (45% for both), as were two-fifths (40%) of Sales workers. Casuals who reported receiving a casual loading as part of their pay represented 26% of Sales workers who were employees (end note 2) and 25% of Labourers. Employees (end note 2) who were Managers were the least likely to be casual (less than 8% in all three measures).

8. Casual employees(a), Occupation - November 2006
		Proportion in each occupation
	All employees	Without paid leave entitlements	Self-identified as casual	Received casual loading
Occupation(b)	'000	%	%	%
Managers	763.5	7.7	5.5	4.1
Professionals	1 701.5	11.6	10.1	8.1
Technicians and trades workers	1 136.6	16.6	14.3	9.1
Community and personal service workers	783.2	36.2	37.6	23.6
Clerical and administrative workers	1 350.8	17.6	17.9	10.8
Sales workers	757.7	40.2	40.4	25.9
Machinery operators and drivers	587.7	23.4	22.9	14.7
Labourers	881.8	45.0	45.3	24.9
Total employees	7 962.8	22.7	22.0	13.9
(a) Employees (excluding owner managers of incorporated enterprises). See end note 2.
(b) Occupation is classified according to the ANZSCO - Australian and New Zealand Standard Classification of Occupations, First Edition, 2006 (cat. no. 1220.0).
Source: Working Time Arrangements Survey, November 2006.

FURTHER SOURCES OF INFORMATION ON CASUAL EMPLOYEES (end note 2)

There is no one definitive measure to determine the number of people in casual employment at any one time, however, the ABS most regularly uses information on paid leave entitlements as a proxy for measuring casual employment in the Australian labour force. The following ABS household surveys collect data on the following measures of casual employment:

Employees (end note 2) without paid leave entitlements

• Employee Earnings, Benefits and Trade Union Membership Survey
• Forms of Employment Survey
• Job Search Experience Survey
• Working Time Arrangements Survey
• Survey of Employment Arrangements, Retirement and Superannuation
• Multi-Purpose Household Survey topics:
  • Retirement and Retirement Intentions
  • Work Related Injuries

Employees (end note 2) who considered their job to be casual

• Employee Earnings, Benefits and Trade Union Membership Survey
• Forms of Employment Survey
• Working Time Arrangements Survey
• Survey of Employment Arrangements, Retirement and Superannuation

Employees (end note 2) who received a casual loading as part of their pay

• Working Time Arrangements Survey
• Survey of Employment Arrangements, Retirement and Superannuation

Business survey

In addition to the household surveys, the Employee Earnings and Hours business survey also collects information about whether an employee is casual. In this survey, employers are asked to identify whether the employees selected in the survey are casual, and in conjunction they are asked whether these employees receive a casual loading or a higher rate of pay to compensate for a lack of leave entitlements. Information on employees is collected directly from the employer's payroll records, and this is an alternative way of looking at casuals since in this survey they are identified as such by their employers.


FURTHER INFORMATION

For further information about the Working Time Arrangements Survey, see the Working Time Arrangements, Australia, November 2006 (cat. no. 6342.0) publication. This publication is available free of charge on the ABS web site <www.abs.gov.au>.

For further information about the information presented in this article, please contact Scott Lee in Canberra on (02) 6252 7635 or email <scott.lee@abs.gov.au>.


END NOTES

1. Watson, I. 2004, Contented Casuals in Inferior Jobs? Reassessing Casual Employment in Australia, Working paper no. 94, Australian Centre of Industrial Relations Research and Training, Sydney.

2. Employees excluding owner managers of an incorporated enterprise (OMIEs). Owner managers of incorporated enterprises are people who work in their own incorporated enterprise, that is, a business entity which is registered as a separate legal entity to its members or owners (also known as a limited liability company).

3. The Working Time Arrangements Survey collects information about the working arrangements of employees (end note 2) in their main job and the patterns of employees (end note 2) work in all jobs. This survey was last conducted in November 2006 and is one of a range of supplementary surveys run in conjunction with the monthly Labour Force Survey (LFS). This survey was used for the analysis in this article as it is currently the only supplementary survey that collects all three measures of casual employment. Questions were asked of people who were employees (end note 2) in their main job, except those who were contributing family workers in their main job and those aged 15-19 years who were still at school.

4. For further information on the Any Responsible Adult (ARA) method, please see Chapter 17 in 'Labour Statistics: Concepts, Sources and Methods' (cat. no. 6102.0.55.001) available free of charge on the ABS website.

5. Although the statistics presented in this article are restricted to employees excluding OMIEs, the question about whether they received a casual loading as part of their pay was asked of all employees.