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THE EMPLOYER PERSPECTIVE OF INDIGENOUS (UN)EMPLOYMENT
Author(s) -
SAMMARTINO ANDRÉ,
O'FLYNN JANINE,
NICHOLAS STEPHEN
Publication year - 2003
Publication title -
economic papers: a journal of applied economics and policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.245
H-Index - 19
eISSN - 1759-3441
pISSN - 0812-0439
DOI - 10.1111/j.1759-3441.2003.tb01133.x
Subject(s) - schools of economic thought , indigenous , citation , politics , sociology , international business , library science , media studies , management , political science , economics , law , ecology , neoclassical economics , computer science , biology
Over recent years, extensive data and research have confirmed the differential status of Indigenous Australians within the labour market. Indigenous Australians experience higher unemployment, lower participation rates and lower incomes than non-Indigenous workers (Boreham, Whitehouse and Harley, 1993; Daly, 1995; Australian Bureau of Statistics, 2000; Hunter and Gray, 200I). Borooah and Mangan (2002) found Indigenous Australians had poorer occupational outcomes than either white or Asian Australians. These poor labour market outcomes are major factors in the higher poverty levels in the Indigenous community (Albnan and Hunter, 1998).While both supply and demand factors shape the employment opportunities for workers, most of the research on Indigenous employment has relied on supply-side data, especially data on the human capital of individual workers. More recent work has considered demand side and context issues. Hunter and Hawke (2000), for example, identified industrial relations characteristics of workplaces employing Indigenous employees. This paper investigates Indigenous employment from the demand-side, with the main aim being to make an initial contribution to the debate by presenting data on senior management perceptions. Data were collected on the perceptions of 229 CEOs and senior managers in Australian-based businesses. The survey revealed a large number of firms had no Indigenous employees and no policies in place to increase the number. Only a minority of firms employed significant numbers of Indigenous workers. While acknowledging that CEOs and senior management do not typically make individual employment decisions, we argue that their perceptions both shape and reflect their organisations' employment practices. Such perceptions have concrete implications for Indigenous Australians in the labour market, particularly if these translate into preferences based on group membership. Furthermore, we argue that their perceptions reflect the imperfect information about labour quality that permeates labour markets. This claim is illustrated by comparisons between employers' perceptions of Indigenous and non-English speaking background (NESB) workers.We find that Indigenous employment is constrained by CEO perceptions of their human capital - namely their level of education, level of skills and commitment. CEOs believed there to be a shortage of Indigenous job seekers. CEOs also expressed concern about levels of Indigenous absenteeism and retention. We argue that such behaviour is a direct result of Australian businesses' lack of the necessary human resource management policies to adequately attract, retain and manage Indigenous employees and also NESB workers. More fundamentally, such perceptions provide evidence of statistical discrimination. That is, CEOs are using race as a proxy for productivity (Norman, 2003).