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There has been a growing awareness that the issue of labour market disadvantage is substantially greater than merely considering unemployment and the ability to fi nd a job. There is an increasing literature that points to the advantages of considering a broader concept which accounts not only for those people who are traditionally unemployed, but also for individuals who are underemployed and those who are sub-unemployed or discouraged workers. Taking multidimensional survey and census data for Australian metropolitan regions, this paper applies a broad employability framework to an understanding of labour underutilisation which presents the risk of underutilisation as a function of individual characteristics, personal circumstances and the impact of local labour market characteristics. The analysis fi nds that the risk of labour underutilisation is associated with a range of individual characteristics and personal circumstances together with the characteristics of the metropolitan local labour market.

This paper employs the Labour Market Accounts framework to explore how employment growth and commuting patterns interacted to determine changes in the spatial distribution of unemployment in Statistical Local Areas within the NSW GMR over the period 1996–2001. Separate regression models (including control variables) for men and women provide estimates of the relative strength of the relationships between these labour market adjustment responses and the percentage local employment change. The results show that employment growth between 1996 and 2001 has elicited substantial changes in commuting behaviour. Men reveal greater in‐commuting and migration responsiveness to employment growth. Unemployment changes in local areas of the Greater Metropolitan Sydney region have been swamped by commuting responses, potentially posing problems for locally targeted employment strategies.

This paper evaluates the effectiveness of disability employment policy in assisting people with psychiatric disability to find, or return to, paid work. We argue that the poor employment outcomes from current programs establish the need for a paradigmatic shift in the form of a state‐provided Job Guarantee (JG) for people with psychiatric disability. In the absence of measures to generate suitable jobs, forthcoming changes to the eligibility criteria for Disability Support Pension will create risks rather than opportunities. Under the JG, the Federal Government would maintain a ‘buffer stock’ of minimum wage, public sector jobs to provide secure paid employment for this highly disadvantaged group. The role of the state in this alternative model is two fold. First, the state must provide the quantum of JG jobs required. Second, the state must ensure the design of jobs is flexible enough to meet the heterogeneous and variable support needs of workers. This will require effective integration of the JG scheme with mental health, rehabilitation and employment support services.

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