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WHAT'S NEW IN THE LABOUR FORCE
The following outputs were produced for the final time with the May 2014 issue of the detailed quarterly Labour Force release (cat. no. 6291.0.55.003) and will not be available with the August 2014 or future issues:
The above products have been ceased due to:
The definition of duration of unemployment will change from the July 2014 issue of the detailed monthly Labour Force release (cat. no. 6291.0.55.001). The last job to break a period of job search no longer needs to be of a duration of two weeks or longer. Instead any job (of greater than one hour) can break a period of looking for work. This makes it consistent with the definition of employment where any work of one hour or more in the reference week counts as employment.
Further information on changes to outputs is available in the Information Paper: Forthcoming Changes to Labour Force Statistics (cat. no. 6292.0), released on 26 June 2014.
REVISION TO ACTIVE JOB SEARCH STEPS
The ABS has refined some of the questions asked about job search steps in the Labour Force Survey (LFS) questionnaire to better reflect the nature of job search practices in Australia and to better align with international standards. This note outlines the previous practice, what the changes are, the reasons for the changes and the impact on estimates of unemployment.
In accordance with international standards the ABS includes an 'active' job search criteria to define the unemployed population in the LFS. 'Active' job search steps are those which put a person in contact with prospective employers for work, either directly or through intermediaries (such as employment services, agencies or recruiting firms), or represent steps towards 'self-employment'. People who only looked in newspapers or read job advertisements on the internet are not considered actively looking for work, as it is impossible to obtain work without some additional active job search step (for example, contacting the employer).
To maintain consistency in the underlying concept of active job search over time, it is necessary to periodically review the steps which are considered active to reflect current and emerging practices in the labour market. For example, in July 2011 looking on the internet was added to looking in newspapers as a passive job search step and reference to Centrelink touch screens was removed.
WHAT CHANGES HAVE OCCURRED?
Changes to the job search steps were made to the LFS questionnaire from July 2014. These changes aim to more accurately reflect the role of Centrelink in relation to job seekers, to provide greater consistency of treatment of certain job search steps, and to include logical job search steps that were not previously included.
Two new active job search steps have been included in the survey:
Having an interview with an employer is a logical step in the process of getting a job, and given that it may take some time for people to be offered a job after applying (during which time they may attend an interview), including this as an active job search step means that people who are in the process of being considered for a job will not necessarily change from being classified as unemployed to not in the labour force if there are time lags between applying for, being interviewed for and being offered a job.
The previous suite of job search steps did not consider steps taken to start or purchase a business as an active job search step. Activities such as applying for an Australian Business Number or licences, or seeking finance to establish or purchase a business, or obtaining premises or equipment, are considered job search activities for people who are looking to be 'self-employed', i.e. working in their own business. The recognition of these as active job search steps was agreed to at the 19th International Conference of Labour Statisticians, in October 2013, where the standards for work, employment and labour underutilisation were revised.
In addition, two steps which were previously 'active' steps are no longer considered sufficient for a person to be classified as actively looking for work. These are 'checked notice boards' and 'been registered with Centrelink as a jobseeker'.
Previously, the step 'looking in newspapers or on the internet' was not an active job search step, as without taking further steps (such as responding to an advertisement or applying to an employer for a job) a prospective employer would not be made aware that the person was looking for work. Checking notice boards is not conceptually different from checking in newspapers or on the internet, so should be treated in the same way (as not an active job search step), and has been rolled into the current response 'looking in newspapers or on the internet'.
The role of Centrelink in relation to job seekers has changed over time. The core function of Centrelink in relation to job seekers is in the administration of income support, rather than directly supporting job search activities. While registering with Centrelink as a job seeker is a necessary step in order to receive government income support, it is not a step relating to actual job search. Job seekers would need to take active job search steps, in order to be considered actively looking for work.
See the Glossary for the list of job search steps classified as active from July 2014.
IMPACT ON ESTIMATES OF UNEMPLOYMENT
The changes in job search steps could, potentially, change the labour force status of persons between unemployed and not in the labour force. Prior to their introduction the net impact of the changes was assessed as unlikely to be statistically significant and, as accurately measuring any impact is expensive and complex, the ABS did not introduce special measurement arrangements. The ABS did, however, analyse how many respondents in July 2014, compared to historical patterns, were asked which active and passive job search steps they had undertaken in the reference week. There is no evidence that the introduction of the new active job search steps and the changing of two active steps to passive has had a significant impact on the estimates for unemployment and not in the labour force. In addition, changes in participation and the number of unemployed persons did not occur in a consistent manner across states and territories, males and females, and age groups. This further supports the conclusion that the new questionnaire had no systematic impact on the estimates of unemployed persons and persons not in the labour force.
The changes would not have had any impact on the estimates of employed persons.
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