6291.0.55.003 - Labour Force, Australia, Detailed, Quarterly, Feb 2014 Quality Declaration 
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ANALYSIS OF CHANGES TO LABOUR FORCE REGIONAL ESTIMATES

Introduction

From the January 2014 issue of Labour Force, Australia, Detailed (cat. no. 6291.0.55.001), regional estimates are based on the Australian Statistical Geography Standard (ASGS) with estimates revised back to October 1998. Previously, regional labour force data under the superseded Australian Standard Geographical Classification (ASGC) were only available back to November 2007. Regional Labour Force data are now available to ASGS Statistical Area Level 4 (SA4) regions, which are based on discrete labour markets as determined by the journey-to-work information collected in the 2011 Census of Population and Housing. For more information on the introduction of this classification into labour force estimates see Information paper: Regional Labour Force Statistics, 2014 (cat. no. 6262.0).

Additionally, for the period July 1991 to December 2013, labour force estimates have been rebenchmarked to revised population benchmarks, compiled using the latest population benchmarks from the ERP revised following the 2011 Census. These revisions have been introduced concurrently with the introduction of the ASGS.

General Impacts

This article explains the impact of these improvements on regional labour force estimates. In particular, the article uses three labour force regions as examples of how the impacts vary across regions.

The introduction of the revised population benchmarks and ASGS do not involve any change to the underlying unit record data collected in the LFS. Changes to the population benchmarks impact primarily on the level of the labour force estimates (i.e. employed, unemployed and not in the labour force) that are directly related to the size of the population. Changes in population composition such as age, sex or region (as used in the population benchmarks) may result in a different rate of change especially at finer levels of geography. The rebenchmarking has not resulted in any material change to unemployment rates, participation rates or employment to population ratios at the national or state and territory levels.

The state or territory with the largest revision to Unemployment Rate was Northern Territory, with an average revision of 0.2 pts. The largest revision was -1.2 pts in December 1991.

Graph: Unemployment Rate, Northern TerritoryGraph: Unemployment Rate Difference, Northern Territory

Most of the larger revisions apply to the period between July 1991 and March 2001 where composite estimation has now been applied to reduce volatility in the month-to-month estimates.

Capital City / Rest of State estimates

In general terms, level estimates for Greater Capital City Statistical Areas (GCCSA) under ASGS remain at relatively similar magnitudes to previously, although this is due to a combination of the expansion of capital city boundaries under the GCCSA and reduced population benchmarks following the 2011 Census. These factors have generally resulted in lower levels for the Rest of State estimates.

The state with the largest percentage change at the Capital City / Rest of State level was South Australia, as shown below.

Graph: Employed Total, AdelaideGraph: Employed Total, Rest of SA
Graph: Employed Total difference, South Australia
Graph: Unemployment Rate, AdelaideGraph: Unemployment Rate, Rest of SA
Graph: Unemployment Rate Difference, South Australia

The map below compares the ASGS Adelaide Greater Capital City Statistical Area boundary (in red) and the Adelaide Major Statistical Region of the ASGC (in green). This shows that the ASGS region is larger thant the comparable region under the ASGC.

Map: Adelaide

Regional Impacts

As the introduction of the revised population benchmarks and other improvements have been introduced at the same time, it is not possible to separately identify impacts on the regional estimates. While, in general terms, rebenchmarking has not resulted in significant change to unemployment rates, participation rates or employment to population ratios, the ASGS introduces new regional boundaries. Where the regional boundaries have not changed the rates and ratios will not change significantly. It is recommended that historical analysis be based on the ASGS series.

The following examples highlight the variable impacts that can be observed between ASGS and ASGC labour force regions.

One of the regions with a direct 1:1 correspondence between the ASGS SA4s and the ASGC Labour Force Regions is the 'Sydney - Northern Beaches' SA4. Revisions to this region are shown below:

Graph: Employed Total, Northern BeachesGraph: Unemployment Ratel, Northern Beaches
Graph: Employed Total Difference, Northern BeachesGraph: Unemployment Rate Differencel, Northern Beaches

However, in some cases regional boundaries have changed significantly. As the regional estimates have been backcast to October 1998 it is recommended that historical analysis use the ASGS regions rather than comparing the current and previous regions.

For example, one of the regions with a complex correspondence between ASGS SA4s and the ASGC Labour Force Regions is 'Queensland - Outback' SA4 as shown below. The red region is the new SA4, the four underlying green regions are the corresponding areas from the old ASGC Labour Force Regions - 'Mackay-Fitzroy-Central West', 'Darling Downs-South West', 'Northern-North West' and 'Far North'.

Map: Queensland

By using the correspondence provided in Australian Statistical Geography Standard (ASGS): Correspondences, July 2011 (cat. no. 1270.0.55.006), an approximation of the Queensland - Outback SA4 estimates can be calculated from the ASGC Labour Force Region data

Labour Force Regions 2007 to Statistical Area Level 4 2011
LFR_IDLFR_NAMESA4_CODE_2011SA4_NAME_2011RATIOPERCENTAGE

350Mackay-Fitzroy-Central West315Queensland - Outback
0.036
3.6%
351Darling Downs-South West315Queensland - Outback
0.036
3.6%
352Northern-North West315Queensland - Outback
0.150
15.0%
353Far North315Queensland - Outback
0.117
11.7%

Graph: Employed Total, Outback QueenslandGraph: Unemployment Rate, Outback Queensland

The ASGS Queensland - Outback SA4 is more volatile than the approximation based on the four combined ASGC Labour Force Regions. The approximation is based on the (unlikely) assumption that labour force characteristics are uniform within each of the four labour force regions and a pro-rationed average can be used to approximate the labour force characteristics of the areas that overlap with the SA4. This effectively means that people interviewed outside of the SA4 but still within the four overlapping ASGC Labour Force Regions are contributing to the approximation, which results in a larger effective sample and lower volatility, but a less accurate representation of the Queensland - Outback SA4 region.

Changes to the regional labour force estimates have resulted in changes to the standard error models over the period of revision. These have been updated in the standard error datacube provided in Labour Force Survey Standard Errors, Data Cube, Feb 2014 (cat. no. 6298.0.55.001), which was released on 13 February 2014. Updates to the 25% RSE cut-off values have also been made to the standard error tables in this publication.

For any queries regarding the implementation of any of these changes to the LFS contact Labour Force Estimates on Canberra 02 6252 6525, or via email at labourforce@abs.gov.au. The ABS Privacy Policy outlines how the ABS will handle any personal information that you provide to us.