More insecure, less pay: How governments and bosses used COVID-19 to attack essential workers

May 9, 2022
Hobart workers demand a pay rise outside billionaire retailer Harvey Norman in May 2021. Photo: Sam Wainwright

While essential workers kept society running through the pandemic, governments and bosses worked assiduously to undermine their pay and conditions.

Many essential workers are worse off today than they were before 2020: they face even more insecure employment, are often forced to work multiple jobs and all for less pay.

Far from the government line that “everyone was in this together”, it was essential workers who shouldered the bulk of the pain of the pandemic.

Statistics show that essential workers were most at risk of catching COVID-19 during lockdown.

For example, a Catholic Health Australia study in January found that the key predictor for which local government areas (LGAs) recorded the most COVID-19 cases during lockdown was the number of blue-collar workers living there.

It noted that for every 1% increase in the number of blue-collar workers living in a LGA there was, on average, an additional 848 cases of COVID-19 in that same LGA in Sydney, and 895 additional cases for LGAs in Melbourne.

These same LGAs are home to most of the poorly-paid essential workers, given their lower rents and house prices.

The higher case numbers in poorer LGAs correlated with more deaths among the disadvantaged.

Australian Bureau of Statistics (ABS) figures show that the poorer you were the more likely you were to die from COVID-19 during lockdown. While the richest 20% accounted for less than 10% of deaths, the poorest 20% made up more than 36% of deaths.

But essential workers and their families were not just more at risk of catching and dying from COVID-19: they were also more likely to lose hours and pay, and find their jobs becoming more insecure or disappear altogether.

About 540,000 casuals lost their jobs during the first wave of COVID-19, in early 2020, in large part because they were deliberately excluded from the JobKeeper wage subsidy.

Together with part-time workers, casuals made up more than half of the jobs lost during the first lockdowns, and an even higher percentage of the jobs lost during subsequent lockdowns in 2021, according to a Centre for Future Work report published late last year.

The bulk of these casual and part-time workers were employed in essential industries, such as health and aged care, retail, food services, construction and education.

This meant that even if they did not lose their jobs, they often lost hours (and therefore pay) due to being forced to isolate for having contracted the virus or being a close contact.

The Coalition government brags that many of these workers have since regained employment, pointing to an unemployment rate that is the lowest in many years.

But this masks the reality for most essential workers.

It hides the decline in workforce participation during the lockdowns. For example, in Sydney, the labour force fell from 3 to 2.75 million (8.3%) between May and September last year. For women, the decline was 9.2%.

In Sydney’s south-west, home to most of the city’s essential workers, the decline was a high 14%, just in the month of August, as many gave up looking for non-existent jobs.

Moreover, those lucky enough to obtain new jobs have found that their employment situation is more insecure than before.

The biggest expansion of casual employment in Australian history occurred between May 2020–21. This trend was further entrenched by amendments to the Fair Work Act in March 2021 allowing employers to define any position as casual.

The surge in casual work, fixed-term contracts and labour hire gig economy jobs today, means that 4.15 million people — almost 1 in 3 workers — find themselves in insecure employment, according to the Australian Council of Trade Unions. The real figure is likely to be higher given the lack of data on gig economy and labour hire workers.

As such, more than 4 million workers in Australia lack leave entitlements, job security and guaranteed hours. They are not even able to count on supports, such as the Pandemic Leave Payment, as they once could.

Contrary to claims that such workers receive extra wages, or loading, to compensate for the loss of entitlements, ABS figures show that, on average, casuals working full-time hours (of which there are nearly 900,000) earn $355.40 a week less than their permanent full-time counterparts.

Meanwhile, casuals working part-time hours earn an average $362 less than their permanent part-time counterparts.

As a result, more workers than ever — 867,000 or 6.4% of all workers — have to work multiple jobs to get by, with essential workers making up a disproportionate share of these.

According to the Centre of Future Work, if casuals earned the same wages as permanent staff, total wage payments would rise by about $30 billion a year, thereby boosting the total wage and salary income for workers by 3.5%.

Instead, the rise in low-paid insecure work, combined with the federal and state government-imposed public sector wage rise caps and the decline in the real value of the minimum wage (when inflation is taken into account),  meant workers’ real wages fell by 2.1% compared to pre-pandemic levels.

In real monetary terms, an average worker suffered an $800 pay cut in 2021 and is set to lose almost another $2,000 in the first half of 2022.

Meanwhile, corporate profits during the pandemic have averaged more than 28% of gross domestic product — its highest level in Australia’s history. This is quite a turn around considering the economic impact of COVID-19 and the fact that Australia’s stock market was well on its way to crashing before the virus emerged.

This record rise in profits is directly related to bosses and governments’ attacks on the livelihoods of workers during the pandemic. Given the record in government of both major parties, these attacks will continue regardless of who wins the elections.

The only option left for workers is to organise and fight back.

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