Small Area Labour Markets publication – Explanatory Notes

Structure of regional estimates in Tables 1 and 2

State/Territory data by Statistical Area Level 2 (SA2) and Local Government Area (LGA) are presented in Tables 1 and 2, respectively. For the States and the Northern Territory, estimates for the Capital City and the Rest of State area are also presented in Table 1.

There are around 2,200 SA2s and 540 LGAs in Australia. The SA2s are a geographical unit that comprise the Statistical Area Level 4s in the Australian Bureau of Statistics’ (ABS) 2016 Australian Statistical Geography Standard (ASGS), upon which the ABS Labour Force Survey data are based. The SA2 estimates are then concorded to the LGA level in Table 2 using population weights based on the latest available SA2 to LGA correspondence from the ABS.

Methodology

The estimates in Tables 1 and 2 are based on the Structure Preserving Estimation (SPREE) methodology, which enables the generation of small area unemployment, unemployment rate and labour force estimates. Given the level of disaggregation involved, the data are smoothed (ie, averaged) over four quarters to dampen the variability inherent in the small area estimates.

The estimates presented in Table 1 and 2 are derived from three primary data sources:

  1. Current recipients of Youth Allowance (other), and current recipients of Newstart Allowance/JobSeeker Payment who are not on a zero rate of payment, by SA2;
  2. ABS Labour Force Survey data by ABS Statistical Area Level 4 (SA4). The ABS Labour Force Survey samples private and non-private dwellings (approximately 6,000 households) across Australia and covers about 0.32 per cent of the population. More details about the methodology underpinning this survey are included in the ABS publication, Labour Force, Australia (cat. no. 602.0); and
  3. Participation rate data at the SA2 level from the Census of Population and Housing (the latest SALM data use the 2016 Census, but estimates prior to the March quarter 2014 use 2011 Census benchmarks).

The purpose of SPREE is to produce small area labour market estimates that reflect the regional disparities of the Centrelink data, while being consistent with the ABS Labour Force Survey estimates.

Unemployment estimates are produced by apportioning the level of unemployment at the SA4 level, as published by the ABS, across each of the SA2s within that region. This apportioning is based on the distribution of Centrelink Newstart/JobSeeker and Youth Allowance (other) beneficiaries at the SA2 level, benchmarked by ABS unemployment estimates by age, sex and marital status at the Greater Capital City Statistical Area (GCCSA) level.

Labour force estimates are produced by:

  • taking the participation rate for each SA2 from the Census (in instances where an SA2 does not have a participation rate, the participation rate for the SA3 was used as a proxy);
  • applying this to the latest available ABS estimated resident population (ERP) data for persons aged 15 and over for the SA2, to produce a labour force weighting for the SA2 within the SA4; and then
  • allocating the total labour force for each ABS SA4 to the SA2s within that region according to the labour force weighting.

By using Census participation rates and the latest available ERP, the SA2 labour force estimates are able to adjust to changes in the distribution of population within an SA4 that have occurred since the last Census.

Unemployment rate estimates are produced by calculating the level of unemployment as a proportion of the labour force (consistent with ABS methodology).

As the reliability of estimates at the SA2 level are related to the size of the SA2, estimates are only published for SA2s that have a labour force of 100 or more as at the June quarter 2019. In addition, caution should still be exercised when interpreting movements in the estimates for SA2s or LGAs with a labour force of less than 1,000.

  • While the underlying methodology used to produce the small area estimates in SALM is robust for the vast majority of areas, in a small number of cases it can result in figures that do not accurately reflect labour market conditions within the region. As this is the case for the SA2 and LGA of Aurukun, these figures are not published.

Due to both the methodology used and the significantly higher variability of the data disaggregated below the SA2 or LGA level, it is not possible to derive reliable unemployment and unemployment rate estimates for particular groups (i.e.; males, females, youth) within an SA2 or LGA.

Derivation of Employment Estimates

The data in Tables 1 and 2 in this publication are synthetic estimates based on ABS and Centrelink unemployment numbers and labour force data from the Labour Force Survey and the Census. As the production of SALM does not involve the use of any sources of, or attempt to estimate, the level of employment in an SA2, employment estimates should not be derived from these statistics. For more information, please email the SALM inbox at SALM@skillscommission.gov.au.

Other sources of Information

This publication, as well as data files in Excel format containing estimates back to the December quarter 2010, can be downloaded from the SALM website.

Unsmoothed series

The smoothed estimates presented in Tables 1 and 2 are the Department’s official estimates of unemployment and the unemployment rate at the SA2 and LGA level. It is recognised, however, that some advanced users may need access to the unsmoothed estimates, which are used to produce the official figures. They are available on the SALM website under the explanatory notes section.

2011 ASGS SA2 and LGA estimates

Due to the quarterly population rebenchmarking of regional ABS Labour Force Survey data, the more recent 2011 ASGS estimates (up to the March quarter 2019) will continue to be revised for a number of quarters going forward. Estimates for those SA2s that have not had a break in series are included in the data files available online. However, if users need to obtain the latest available 2011 ASGS SA2 or LGA estimates for areas that have had a break in series, please email the SALM inbox at SALM@skillscommission.gov.au.