Working hours in Australia are quite widely distributed around the population mean. That is,
there are relatively many people working both relatively short hours and relatively long hours
each week. From a welfare perspective, however, it is not the actual number of hours worked
that is of importance, but whether the hours being worked are consistent with individual
preferences. In this paper the question of how closely hours preferences are being met is
examined using data collected in the first wave of the HILDA Survey. The study focuses
specifically on workers in couple households.
The analysis involved two main stages. In the first stage, evidence of a significant time divide
– the co-existence of many people working part-time hours who would prefer to work longer
and many people working very long hours who ould prefer to work fewer hours – is found.
The extent of this time divide, however, should not be overstated – the hours of the majority
of workers are still reasonably close to their stated preference.
The second stage of the analysis focused on identifying the factors associated with mismatch
in working hours preferences. The extent of overemployment, for example, is found to rise
with age, and is more pronounced among the self-employed and less pronounced among those
with a recent history of unemployment. Underemployment, on the other hand, is also
associated positively with self-employment, as well as with casual employment. Perhaps of
most interest, we find that in couples preferred hours are influenced by whether or not, and
the extent to which, partners achieve their working time preferences. That is, if one member
of the couple is unable to work as many hours as desired, this leads their partner to prefer
more hours.