Notes on the data: Labour force

Unemployment, June 2023

Policy context: Those who do not have access to secure and satisfying work are less likely to have an adequate income; and unemployment and underemployment are generally associated with reduced life opportunities and poorer health and wellbeing. Although the relationship between unemployment and health is complex and varies for different population groups, there is consistent evidence from research that unemployment is associated with adverse health outcomes; and unemployment has a direct effect on physical and mental health over and above the effects of socioeconomic status, poverty, risk factors, or prior ill-health [1] [2].

Persistent disadvantage can also come from periods of long-term unemployment. Long periods of unemployment can have significant economic and social consequences for people, including the loss of skills and networks, social stigma, and financial insecurity. Employment provides an important pathway to break the cycle of entrenched disadvantage. Strong labour market conditions in recent years have been widespread and benefited many communities. In 2022–23, the unemployment rate was at or below 4 per cent in over three-quarters of all regions, compared to around 10 per cent of regions in 2020–21. The long-term unemployment rate is also around its lowest level in over a decade [3].

Readers should note that the official measure of unemployment, which this indicator is designed to emulate for small geographical areas, does not take account of hidden unemployment (measured by the labour force participation rate) or underemployment (resulting from the loss of full-time jobs and the creation of part-time jobs).

References

Mathers CD, Schofield DJ. The health consequences of unemployment: the evidence. Med J Aust. 1998;168(4):178-82.
Dollard MF, Winefield AH. Mental health: overemployment, underemployment, unemployment and healthy jobs. Aust e-J Adv Mental Hlth. 2002:1(3).
The Commonwealth of Australia, Intergenerational Report 2023: Australia’s future to 2063.

Notes:

Population Health Area, Local Government Area, Primary Health Network, Quintile of socioeconomic disadvantage of area and Quintiles within PHNs, and Remoteness Area

These estimates of unemployment, from the Small Area Labour Markets - Australia data series [1], are based on the Structure Preserving Estimation (SPREE) methodology which enables the generation of small area unemployment, unemployment rate and labour force estimates. They differ from the figures both for people receiving an unemployment benefit (as different rules are applied to eligibility for a welfare payment) and being considered as unemployed in the labour force statistics produced by the Australian Bureau of Statistics (ABS). The unemployment estimates presented are based on the 'smoothed' data series, where the data have been averaged over four quarters to minimise the variability inherent in small areas estimates: this also apples to the estimates of the labour force used as the denominator to calculate the unemployment rate. The estimates presented are derived from two primary data sources:

Current recipients of Youth Allowance (other) and current recipients of Newstart Allowance who are not on a zero rate of payment, by SA2; and
ABS Labour Force Survey data by ABS Statistical Area Level 4 (SA4). The ABS Labour Force Survey samples private and non‐private dwellings (approximately 26,000 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. 6202.0).

References

Department of Employment, Skills, Small and Family Business. Small Area Labour Markets - March quarter 2019. Available from: https://www.employment.gov.au/node/10604; last accessed 4 February 2020.

Geography: Data available by Population Health Area, Local Government Area, Primary Health Network, Quintile of socioeconomic disadvantage of area and Quintiles within PHNs, and Remoteness Area

Numerator: Unemployed people aged 15 years and over

Denominator: People in the labour force aged 15 years and over

Detail of analysis: Per cent

Source: Compiled by PHIDU based on data from the Labour Market Analysis and Advice Team, Jobs and Skills Australia, June Quarter 2023.