IN a draft report released yesterday, the Productivity Commission hailed geographic labour mobility as a boon for easing Australia’s economy into major structural change and credited a flexible labour market with distributing wealth across the nation.

The draft report, which aims to identify key traits, opportunities and challenges in labour mobility, found that labour in Australia is highly responsive to market conditions and willing to migrate to new regions in pursuit of employment.

“Generally, people are moving to areas with better job opportunities and employers use a range of strategies to attract employees with the required skills,” Commissioner Alison McClelland said.

The tactics recognised in the report as stimulants of labour mobility include the fly-in, fly-out (FIFO) working arrangements used frequently by resource employers.

“FIFO has been instrumental in attracting sufficient mining and construction workers to mining areas during the resources boom, and spreading the benefits of the boom across the economy more broadly,” the report said

“FIFO has also dulled the boom–bust cycle that mining towns might otherwise experience if all employees had to be residential.”

In addition to FIFO provisions, the report also points to employer-based incentives as a significant driver behind geographic labour mobility, including:

• Relocation incentives;
• Return of services obligations;
• Recruitment of underutilised labour;
• Training to facilitate relocation;
• Telecommuting; and
• International migration.

As a reflection of such incentives within the resource industry, miners have been identified as the most mobile workforce in terms of residential relocations, with nearly 10% of the resource workforce relocating for employment purposes between 2011 and 2012.

Though geographic labour mobility is credited with supporting the economy through a structural change, the Commission admits there is room for improvement, particularly in regulatory reform.

Recommendations from the report include:

• Cutting stamp duties;
• Improving assistance for unemployed people to find employment in other locations;
• Improving the efficiency of land-use planning and land release and the operation of the Commonwealth Rent Assistance program to overcome housing shortages and high prices; and
• Urgently addressing the substantial delays in the implementation of the national occupational licensing system.

For a full copy of the draft Geographic Labour Mobility report, click here.