We're working, but not as much as we want to – and that keeps wages low

Last year was an average year for employment, which is not completely damning with faint praise. Given the low overall economic growth that existed through 2019, it is somewhat surprising that employment growth remained as solid as it did. But the story of the 2019 labour market also reflects the ongoing trends that have led to the low wages growth that unfortunately looks set to continue for the new year.

We began 2019 with the unemployment rate at 5.0% and we left it with the rate at 5.1%. This in itself suggests not much happened, but if we look at the chart of the unemployment rates for men and women, we see that last year was one where these two genders had very different outcomes.

Related: A new decade is likely to bring another year of low wages growth | Greg Jericho

Both men and women also had 5.0% unemployment in December 2018, but while women’s unemployment rate remains at that level (and with a rate of 4.96% close to being rounded down to 4.9%), the rate for men has risen to 5.3%.

We can also see that while the labour market began improving for women in August, for men it was not until the very end of the year that any gains occurred.

This is reflected in the employment growth for men and women: 2019 saw employment grow by 2.05% overall – pretty much on the post-1990s average of 2%, although the slowest since 2016.

Full-time employment growth was marginally down on the long-term average, while part-time employment growth was marginally above average.

Last year there were 132,600 full-time jobs created, compared to 128,300 part-time jobs. It translated to full-time employment growth being the slowest since 2016, while part-time employment growth was the fastest since that year.

And it was men who mostly missed out on the growth in full-time jobs. Male full-time employment grew by just 0.5% in 2019, compared to 3.3% for women.

The relatively poorer growth of full-time employment is reflected in the overall weak growth in the average hours worked per capita.

At the end of last year the average person over 15 years of age worked 86 hours and 15 minutes a month, compared to 86 hours and 9 minutes at the end of 2018. That 0.1% growth was again the worst since 2016 and well down on the very strong 1.4% growth of 2017.

This also continues the story of the past five years, where the rate of people in employment has risen almost back to pre-GFC levels, while the average hours worked remains well below the peak of 2008.

And with that weak growth of hours worked comes the rise in underemployment – the biggest factor keeping wages growth low.

The situation of workers trading off between more hours or higher wages growth appears set to continue, because not only was there little change in the overall unemployment rates, neither was there any great improvement in the level of underemployment.

Last year saw underemployment effectively stay flat at 8.3% overall, but with big rises for workers over 55 years of age and for those aged 25-34.

And this means that the split of unemployment and underemployment remains in place.

Over the past five years while unemployment has improved, underemployment has either worsened or remained flat, to the point where the underemployment rate is now 3.2 percentage points higher than unemployment – almost double the long-term gap.

And of course you would be right to think this split is due to the lack of full-time employment growth for men. It is no surprise that if fewer men are working full-time then more men overall are going to be unhappy with the number of hours they are working.

But men now make up only 52% of all workers in Australia (compared to 56% at the start of the century), so while men being more underemployed than in the past is going to have an impact, it is worth remembering that women have always had higher levels of underemployment.

This is because more men work full-time than women (men make up 62% of all full-time workers).

But even as more women have come into the workforce, the level of underemployment has remained high.

And women as well have seen a split in the movement of the two rates.

Prior to the end of 2014 women’s unemployment and underemployment moved in sync, but since then they have gone their separate ways. In the later part of last year, while the unemployment rate for women aged 25-64 fell significantly, from 4.2% to 4.0%, the underemployment rate for these women in their prime-earning ages rose slightly, from 8.45% to 8.51%.

The reason is that women, like men, have seen a decline in the level of full-time work. Just 54.2% of women in employment work full-time – a level that is actually lower than what was the case for most of the time prior to 2014.

It means that while 2019 was a generally fine year for workers, there were not enough full-time jobs around to not just reduce unemployment but – crucially – underemployment.

And while that remains the case, our wages growth will remain at the current low levels.

• Greg Jericho writes on economics for Guardian Australia