The development of this trend does not mean higher unemployment but a much greater increase in those who have given up actively looking for work (you can’t be counted as unemployed unless you are actively looking).
You say that Kent mainly attributes this development to an increased desire to retire and that only about 25 per cent are discouraged workers. But the sudden increase in drop outs coincides with the introduction of the greatly increased regulation of workplace relations and the accompanying employment deterrent effects experienced by employers, such as the absurd penalty rates.
The marked slowing in the growth in employment to only 0.9 per cent over the past 12 months suggests that the budget forecast for 2014-15 of 1.5% growth will be very difficult to achieve unless major changes are made to existing regulations which markedly reduce deterrent effects.The unemployment rate has ceased to be a useful indicator [of the state of the labour market]. A more important test is whether the growth in employment is keeping up with the working age population increase. Before the Fair Work legislation employment was growing faster than the working age population.
Tony Abbott needs to reform industrial relations at a much faster pace.
Des Moore is a member of the HR Nicholls Society Board of Management. This is a letter published in AFR, 19 June 2014, Square brackets shows deletion by Ed