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6202.0 - Labour Force, Australia, Apr 2009 Quality Declaration 
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 07/05/2009   
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INTERPRETING GROSS FLOWS


INTRODUCTION

In the Labour Force Survey, one-eighth of the dwellings sampled in the previous month are replaced, in the current month, by a new set of dwellings from the same geographic area. The seven-eighth overlap between the dwellings selected in consecutive months maintains continuity within the population survey sample and enables more reliable measurement of change in the labour force characteristics of the population than would be possible if a new sample was introduced each month.

The matching of respondents who report in consecutive months enables analysis of the transition of individuals between the different labour force status classifications, referred to as the matched sample. The transition counts between the different labour force status classifications from one point in time to the next are commonly referred to as gross flows.


QUALITY OF DATA

The gross flows figures in Table 17 are presented in original terms only and do not align with published labour force estimates. The gross flows figures are derived from the matched sample between consecutive months, which after taking account of the sample rotation and varying non-response in each month is approximately 80 percent of the sample. Refer to the article in the March 2009 issue of Labour Force, Australia (cat no. 6202.0) for detailed quality statements.


USING GROSS FLOWS FIGURES TO ANALYSE MOVEMENTS IN EMPLOYMENT

Gross flows figures can assist in understanding the movements in labour force status. For example, in the April 2009 labour force estimates, the number of employed persons, in trend terms, decreased 4,300 persons; comprised of a decrease in full-time employment of 8,500 persons, that was partly offset by an increase in part-time employment of 4,200 persons. However, in original terms, the number of employed persons increased 14,800 persons; comprised of an increase in full-time employment of 37,000 persons and a decrease in part-time employment of 22,200 persons.

When attempting to interpret the increase in full-time employment, in original terms, the following questions arise regarding the population:

  • Are people moving from part-time employment into full-time employment?
  • Are they moving from unemployment to employment?
  • Are they moving from not in the labour force to employment?


Movement between full-time employment and part-time employment

Referring to Table 17 one can observe, in original terms, the following counts for transitions between full-time employment and part-time employment:
  • 276,000 persons employed part-time in March 2009 were employed full-time in April 2009;
  • 259,000 persons employed full-time in March 2009 were employed part-time in April 2009; and
  • a net increase from the matched sample of 17,000 persons (276,000 minus 259,000 persons) from part-time employment to full-time employment.

Therefore, in the matched sample, there were more persons who moved from part-time employment to full-time employment than in the other direction.


Movement between employment and unemployment

Referring to Table 17 one can observe, in original terms, the following counts for transitions between employment and unemployment:
  • 116,000 persons unemployed in March 2009 were employed in April 2009
  • 86,000 persons employed in March 2009 were unemployed in April 2009; and
  • a net increase from the matched sample of 30,000 persons (116,000 minus 86,000 persons) from unemployed to being employed.

Therefore, one can observe from the matched sample, that there were more persons who moved from unemployment to employment than in the other direction.


Movement between employment and persons not in the labour force

Referring to Table 17 one can observe, in original terms, the following counts for transitions between employment and persons not in the labour force:
  • 180,000 persons not in the labour force in March 2009 were employed in April 2009;
  • 204,000 persons employed in March 2009 were not in the labour force in April 2009; and
  • a net decrease from the matched sample of 24,000 persons (180,000 minus 204,000 persons) from employed in March 2009 to being not in the labour force.

Therefore, one can observe from the matched sample, that a proportion of persons who were in employment have moved directly out the labour force.


Movement between unemployment and persons not in the labour force

Referring to Table 17 one can observe, in original terms, the following counts for transitions between unemployment and persons not in the labour force:
  • 114,000 persons not in the labour force in March 2009 were unemployed in April 2009;
  • 147,000 persons unemployed in March 2009 were not in the labour force in April 2009; and
  • a net decrease from the matched sample of 33,000 persons (114,000 minus 147,000 persons) from unemployed in March 2009 to being not in the labour force.

Therefore, one can observe from the matched sample, that a proportion of persons who are now not in the labour force were looking for work in March 2009.


CONCLUSION

Gross flows figures can assist in understanding the movements in labour force estimates. The figures presented in gross flows do not align with published labour force estimates and should only be used to interpret movements in published labour force estimates.


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