Australian Bureau of Statistics
6102.0.55.001 - Labour Statistics: Concepts, Sources and Methods, Aug 2006
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 01/12/2006
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Labour Statistics: Concepts, Sources and Methods was originally released in 2001 in both electronic and paper versions (cat. no. 6102.0). The paper publication will not be rereleased. However, the web version (cat. no. 6102.0.55.001) is being updated on an ongoing basis. This chapter was updated on 1 December, 2006.
4.5 The legal status concept is used to classify owner-managers of incorporated businesses as employees rather than as employers or own account workers, for consistency with Australian National Accounts practice. Individuals who work in their own business are queried about the legal status of the business. Although they may 'own' the business, if it is incorporated the individual is not held personally liable for the economic enterprise should it become insolvent. Those individuals who own an incorporated business, with or without hiring one or more employees, are therefore classified as employees. If the business is unincorporated (and hence the owner is liable for the economic enterprise), those who hire employees are classified as employers and those who do not are classified as own account workers.
4.6 The Australian status in employment classification is illustrated in diagram 4.1.
4.1 AUSTRALIAN STATUS IN EMPLOYMENT CLASSIFICATION
4.7 The occupation classification used in ABS surveys is the Australian and New Zealand Standard Classification of Occupations (ANZSCO) First Edition 2006. Occupation data are available from the Labour Force Survey (quarterly), a number of supplementary topics to the Labour Force Survey, and most Special Social Surveys as well as the five-yearly Census of Population and Housing.
4.8 ANZSCO is a skill-based classification of occupations which covers all jobs in the Australian workforce. Occupation information collected in surveys and the Census provides a description of a person's job and refers to the kind of work undertaken by an employed person irrespective of the industry in which that job is held. Jobs and occupations are fundamental concepts to the classification. A job is a set of tasks designed to be performed by one individual. An occupation is a set of jobs with similar sets of tasks. Occupations are classified according to two criteria - skill level and skill specialisation.
4.9 Skill level is a function of the range and complexity of the set of tasks involved. The greater the range and complexity of the set of tasks, the greater the skill level of the occupation. The criteria used in ANZSCO First Edition to measure skill level are the formal education and/or training, previous experience and on-the-job training usually required for entry to the occupation.
4.10 Skill specialisation of an occupation is a function of the field of knowledge required, tools and equipment used, materials worked on, and goods or services produced in relation to the tasks performed. Skill specialisation is used to group occupations according to type, rather than level of skill.
4.11 The structure of ANZSCO First Edition comprises five hierarchical levels: Major Groups (the broadest level), Sub-Major Groups, Minor Groups, Unit Groups and Occupations (the finest level). The Major Groups are distinguished from each other on the basis of skill level, and, where necessary, the broad concept of skill specialisation. The eight Major Groups are:
3 Technicians and Trades Workers
4 Community and Personal Service Workers
5 Clerical and Administrative Workers
6 Sales Workers
7 Machinery Operators and Drivers
4.12 The sub-major group, minor group, unit group and occupation levels provide increasingly detailed dissections of the broad categories. For further information on ANZSCO First Edition, refer to ANZSCO: Australian and New Zealand Standard Classification of Occupation, First Edition (cat. no. 1220.0).
HOURS OF WORK
4.13 Information on hours of work enables: classification of employed persons according to the number of hours worked; classification of employed persons into full-time and part-time status; and the identification of underemployed persons. The general notion of hours of work encompasses a number of related concepts: usual hours worked; hours actually worked; normal hours of work; and hours paid for (including both normal hours and overtime hours).
USUAL HOURS OF WORK
4.14 Usual hours of work refers to a typical period rather than to a specified reference period. The concept of usual hours applies both to persons at work and to persons temporarily absent from work, and is defined as the hours worked during a typical week or day. Actual hours worked (for a specific reference period) may differ from usual hours worked due to illness, vacation, strike, overtime work, a change of job or similar reasons.
4.15 Measures of usual hours of work are available from: the Labour Force Survey (see Chapter 20); the Labour Force Survey supplementary survey, the Underemployed Workers Survey (see Chapter 21.14); and from various Special Social Surveys, including the Survey of Employment Arrangements and Superannuation (see Chapter 23). Measures of usual hours of work are not available from ABS business surveys.
ACTUAL HOURS OF WORK
4.16 International resolutions relating to actual hours worked adopted by the Tenth ICLS in 1962 refer to wage and salaried employees. There are no international recommendations relating to actual hours worked for all categories of employed. However the ILO, in its manual 'Surveys of Economically Active Population, Employment, Unemployment and Underemployment' suggests that actual hours worked in a given job should be defined to cover all types of employment in labour force surveys.
4.17 According to the international resolution, actual hours of work refers to a specified reference period and includes:
4.18 The ILO suggests that for multiple job holders (in the case of labour force surveys), actual hours worked should equal the hours worked at all jobs.
4.19 ABS measures of actual hours of work are consistent with the international recommendations outlined above except for time spent travelling to and from work by the self-employed which is sometimes included in household surveys.
4.20 Measures of actual hours of work are available from a number of ABS household surveys: the Labour Force Survey (see Chapter 20) for more detail on the content and methodology of this survey); various labour-related supplementary topics to the Labour Force Survey (see Chapter 20, Sections 1 to 16 for more detail on the content and methodology of labour-related supplementary surveys); various Special Social Surveys, including the Survey of Employment Arrangements and Superannuation (see Chapter 23), and the Survey of Employment and Unemployment Patterns (see Chapter 24); and the Census of Population and Housing (see Chapter 19). Measures of actual hours of work are not available from ABS business surveys.
HOURS PAID FOR
4.21 Measures of hours paid for are collected in both ABS household surveys and ABS business surveys including: the Survey of Employee Earnings and Hours (a business survey - refer to Chapter 30 for more detail on survey content and methodology); and the Labour Force Survey supplement, the Employee Earnings, Benefits and Trade Union Membership Survey (refer to Chapter 21.2 for more detail).
4.22 Hours paid for are not necessarily the same as number of hours actually worked (e.g. the quantum of hours reported as 'paid' and as 'worked' would differ for employees on paid leave, or in situations where employees work more or less hours than their paid hours). While ABS household surveys collect details of the number of hours paid, ABS business surveys also collect information on the following components:
4.23 Measures of average (mean) and median hours paid for and average hourly earnings for various categories of employee jobs are produced in various ABS business surveys.
NORMAL HOURS OF WORK
4.24 Normal hours of work were defined in a 1962 ICLS Resolution as "hours of work fixed by or in pursuance of laws and regulations, collective agreements or arbitral awards. Where not fixed by or in pursuance of laws or regulations, collective agreements or arbitral awards, normal hours of work should be taken as meaning the number of hours per day or week in excess of which any time worked is remunerated at overtime rates or forms an exception to the rules or custom of the establishment relating to the classes of workers concerned". In the ABS, normal hours of work are defined as those set down in awards or formal agreements or standard hours of work in the industry or, where these do not exist, 35 hours per week.
4.25 Measures of normal hours of work are not produced by the ABS. However, the concept is used in the full-time/part-time status classification in ABS business surveys.
4.26 The notion of what constitutes a standard full-time working week has required continual re-examination over the last 40 years with the progressive decline in standard hours of work, accompanied by a substantial growth in the number of persons employed under part-time working arrangements.
4.27 In the absence of any internationally accepted definition of part-time work, two approaches have been taken in various countries. The first is objective and is based on the number of hours worked. The second is more subjective and involves classifying workers as full-time or part-time based on the self-assessment of the person concerned irrespective of the number of hours actually worked. The former approach is relatively simple to apply without requiring the respondent to know details about their contractual arrangements on hours worked, but provides no flexibility to accommodate variations in 'normal' hours of work in different industries and occupations. The self-assessment approach does accommodate such differences but is subjective, and its accuracy is dependent on respondents' knowledge of whether they work full-time or part-time in their activity. Both approaches are used in ABS surveys.
4.28 The full-time/part-time status classification differs from, and should not be confused with, the permanent/casual classification. While the classification of full-time and part-time work is based on hours worked, the permanent/casual classifications used in ABS household and business surveys are not. In ABS business surveys the classification of employee jobs as permanent, temporary or casual is based on entitlements to paid leave and the length of employment contracts. Traditionally, ABS household surveys have classified employees as permanent or casual based on their entitlements to paid leave. However, more recently an additional criterion, on whether an employee perceives their job to be casual, has been used to classify employees as self-identified casuals. The permanent/casual classifications used in ABS business and household surveys are discussed later in this chapter.
ABS HOUSEHOLD SURVEYS
4.29 The approach used in the Labour Force Survey and adopted in many other ABS household surveys is to define full-time and part-time status in terms of hours worked. The definition used designates full-time workers as persons who (a) usually work 35 hours or more per week in all jobs, or (b) although usually working less than 35 hours a week, actually worked 35 hours or more during the reference week. Part-time workers are those who usually work less than 35 hours per week, and either did so during the reference week, or were not at work in the reference week. Under this definition, persons with more than one job are defined as full-time if they work more than 35 hours across all of their jobs.
4.30 A subjective approach based on respondents' perception of their full-time or part-time status is used in some supplementary topics to the Labour Force Survey, and in some Special Social Surveys. This approach is most often used where information is sought about work that is not currently being undertaken and where recall problems may be encountered using a more objective approach (e.g. for jobs held 12 months prior to the survey date). It is also sometimes used to determine the full-time or part-time status of each job held by multiple job holders.
4.31 Full-time/part-time status is available from a number of ABS household surveys including: the monthly Labour Force Survey (see Chapter 20) for more detail on the content and methodology of this survey); various labour-related supplementary topics to the monthly Labour Force Survey (see Chapter 20 Sections 1 to 16 for more detail on the content and methodology of labour-related supplementary surveys); various Special Social Surveys including the Survey of Employment Arrangements and Superannuation (see Chapter 23), and the Survey of Employment and Unemployment Patterns (see Chapter 24); and the Census of Population and Housing (see Chapter 19).
4.32 Persons working part-time hours should not be confused with underemployed workers (discussed in Chapter 5) even though both may be working less than 35 hours per week. Part-time workers can be classified into two groups: fully employed part-time workers who work part-time voluntarily, and underemployed part-time workers who work part-time on an involuntary basis (i.e. they want more hours of work) and who may be seeking and/or available for more work.
ABS BUSINESS SURVEYS
4.33 In ABS business surveys, the classification of employee jobs as full-time is based on whether the usual hours worked are equal to, or greater than, what has been agreed to as being full-time under the relevant award or agreement (i.e. normal hours). If there are no agreed or award hours associated with the job, then it is classified as full-time where the usual hours of work per week are 35 or more. Part-time jobs are those not defined as full-time.
4.34 The full-time/part-time status classification is used in the following ABS business surveys: the Survey of Employment and Earnings (see Chapter 31); the Survey of Employee Earnings and Hours (see Chapter 30); and the Survey of Average Weekly Earnings (see Chapter 29).
4.35 Traditionally, ABS household surveys have classified persons in paid employment (employees) as permanent or casual according to their paid leave entitlements. However, more recently an additional criterion, on whether an employee perceives their job to be casual, has been used to classify employees as self-identified casual. The classification used in ABS business surveys is different, classifying employee jobs as either permanent, fixed-term contract or casual. The classifications used in household and business surveys are discussed further below.
4.36 The permanent/casual status classification differs from, and should not be confused with, the full-time/part-time classification which is a classification of hours worked. The full-time/part-time classification was discussed earlier in this chapter.
ABS HOUSEHOLD SURVEYS
4.37 Entitlement to paid holiday leave and paid sick leave has been used in ABS household surveys to distinguish between permanent and casual employees. Employees who were entitled to either paid holiday or paid sick leave (or both) in their main job have been classified as permanent, while employees who were entitled to neither have been classified as casual. This method of identifying permanent and casual employees was simple and objective, and reflected long established definitions of permanent and casual employees used in Australia's industrial relations systems where, under the awards system, casuals were paid loadings in lieu of entitlements to paid holiday leave and paid sick leave. Changes to the leave entitlements of casuals from the late 1990s, where casuals are increasingly entitled to various forms of paid leave, have meant that the classification of permanent and casual employees based solely on paid leave entitlements is no longer appropriate. From late 2000, the terms 'permanent' and 'casual' will no longer be used in ABS household surveys to describe employees with and without leave entitlements. The term 'permanent' will be replaced with the term 'with leave entitlements', and 'casual' will be replaced with the term 'without leave entitlements'.
4.38 In addition to information on leave entitlements, a small number of ABS household surveys also collect information from employees on whether they perceive themselves to be casual. Only those employees who are not entitled to both paid holiday leave and paid sick leave are asked about their casual status in these surveys. Information about leave entitlements is then used together with information on respondents' perception of their casual status to classify employees (excluding owner managers of incorporated enterprises) into three groups.
4.39 The relationship between the two classifications used in household surveys is illustrated in diagram 4.2.
4.2 CLASSIFICATIONS OF PERMANENT AND CASUAL STATUS USED IN ABS HOUSEHOLD SURVEYS
4.40 ABS household surveys for which the 'with leave entitlements'/'without leave entitlements' classification (previously known as permanent/casual classification) is available include a number of supplements to the Labour Force Survey: the Employee Earnings, Benefits and Trade Union Membership Survey (Chapter 21.2); the Working Arrangements Survey (Chapter 21.16); and the Work Related Injuries Survey (Chapter 21.15). Household surveys which also use information on employees' self-perception of their casual status include: the Labour Force Survey supplement, the Forms of Employment Survey (footnote 1) (Chapter 21.3); and the Special Social Survey, the Survey of Employment Arrangements and Superannuation Chapter 23).
ABS BUSINESS SURVEYS
4.41 The permanent/fixed-term contract/casual classification is available from the Survey of Employee Earnings and Hours (Chapter 30). In the survey, employee jobs are classified according to respondents' perception of the permanent, fixed-term contract or casual nature of the job. To assist respondents to classify jobs, some information is provided on the survey questionnaire about each type of job. Permanent jobs are described as jobs with paid annual and sick leave entitlements. Fixed-term contract jobs are described as jobs with some leave entitlements but with a short-term employment contract. Casual jobs are described as jobs with higher rates of pay, to compensate for lack of permanency and leave entitlements.
4.42 The adult/junior classification is only available from ABS labour-related business surveys. In these surveys, adults are defined as employees aged 21 years or over, and employees who are paid at the adult rate regardless of their age (e.g. employees aged under 21 years may be paid at the full adult rate for their occupation). Juniors are employees aged under 21 years who are not paid at the adult rate of pay for their occupation. ABS labour-related business surveys for which the adult/junior classification is available include the Survey of Employee Earnings and Hours (Chapter 30). The Survey of Average Weekly Earnings (Chapter 29). also produces estimates relating to full-time adult jobs.
4.43 Adult/junior status is not determined in household surveys; however, details of age are collected.
4.44 The managerial/non-managerial classification is only available from ABS business surveys. Managerial jobs are defined as those involving responsibility for a significant number of employees, or having significant responsibilities in the conduct or operations of an enterprise/organisation. They do not usually have overtime payment entitlements. Jobs occupied by professionally qualified persons are defined as managerial only if the occupant primarily performs managerial tasks. Jobs occupied by working proprietors of incorporated businesses are considered managerial. Non-managerial occupations include supervisors, clerical staff, tradespersons, non-managerial professionals, apprentices, trainees and cadets. The managerial/non-managerial classification is only available from the Survey of Employee Earnings and Hours (Chapter 30).
4.45 The number and types of employment groups identified in the status in employment classification (paragraphs 4.2-4.6) are extended in two household surveys which examine working relationships in detail: the Forms of Employment Survey (a supplement to the Labour Force Survey); and the Survey of Employment Arrangements and Superannuation. Both surveys examine the nature of employment arrangements of persons whose status in employment is an employee (footnote 2), employer or own account worker; and then reclassify these persons into alternative paid employment and self-employment groups.
FORMS OF EMPLOYMENT SURVEY
4.46 The 1998 Forms of Employment Survey (a supplement to the Labour Force Survey) identified five employment types: employees with leave entitlements; self identified casuals; other employed; owner managers of incorporated enterprises; and owner managers of unincorporated enterprises. These groups are described in more detail below.
4.47 The classification used in the 1998 Forms of Employment Survey is illustrated below. Note that the classification used in the 1998 survey was experimental, and will be revised for repeats of the survey in 2001 and beyond. The revised classification will be based on the employment type classification used in the Survey of Employment Arrangements and Superannuation, which is described below. A comparison of the employment type classifications used in the 1998 Forms of Employment Survey and the Survey of Employment Arrangements and Superannuation is also provided below.
4.3 EMPLOYMENT TYPE CLASSIFICATION - FORMS OF EMPLOYMENT SURVEY, 1998
SURVEY OF EMPLOYMENT ARRANGEMENTS AND SUPERANNUATION
4.48 The Survey of Employment Arrangements and Superannuation also identifies five employment types: employees with any leave entitlements; self identified casuals; employees without leave entitlements; owner managers of incorporated enterprises; and owner managers of unincorporated enterprises. Three of these groups are then further classified as follows: employees with any leave entitlements as either holding a fixed-term employment contract or not; and both owner managers of incorporated enterprises and owner managers of unincorporated enterprises as either working on a contract basis or not. These groups are described in more detail below:
4.49 The classification used in the Survey of Employment Arrangements and Superannuation is illustrated in diagram 4.4.
4.4 EMPLOYMENT TYPE CLASSIFICATION - SURVEY OF EMPLOYMENT ARRANGEMENTS AND SUPERANNUATION
COMPARISON OF EMPLOYMENT TYPE CLASSIFICATIONS: THE 1998 FORMS OF EMPLOYMENT SURVEY AND THE SURVEY OF EMPLOYMENT ARRANGEMENTS AND SUPERANNUATION
4.50 There are some important differences in the way in which people are classified to employment type categories in the 1998 Forms of Employment Survey and the Survey of Employment Arrangements and Superannuation. These differences are outlined below.
4.51 All those making up the 'other employed persons' category in the Forms of Employment Survey were allocated to different categories in the Survey of Employment Arrangements and Superannuation, and so the category 'other employed persons' is not used in the latter survey.
4.52 Apart from these differences, there is an extra level of detail in the employment type categories of the Survey of Employment Arrangements and Superannuation: employees with some leave entitlements are subdivided into those working on a fixed-term contract and those not working on a fixed-term contract; and owner managers of incorporated and unincorporated enterprises are subdivided according to whether they are working on a contract basis.
OTHER EMPLOYMENT MEASURES
4.53 Measures of working arrangements supplement measures of hours of work, full-time and part-time status, and other classifications of jobholders (such as status in employment, permanent/casual status etc.) and are useful in understanding changing workplace employment conditions. Detailed information about working arrangements is collected in a number of ABS surveys: the supplements to the Labour Force Survey, namely the Working Arrangements Survey, the Forms of Employment Survey, the Locations of Work Survey, and the Employee Earnings, Benefits and Trade Union Membership Survey; and the Special Social Survey, namely the Survey of Employment Arrangements and Superannuation.
Working Arrangements Survey
4.54 The Working Arrangements Survey (a supplement to the Labour Force Survey), collects information about: patterns of hours worked, including flexibility of start and finish times and ability to work extra hours in order to take time off; entitlement to rostered days off including whether there is choice in when a rostered day is to be taken off; overtime including regularity of overtime, whether usually works the same number of hours each week, number of overtime hours usually worked, methods of payment and main reason usually works overtime; shift work; part-time work including reasons for working part-time; job sharing; child-care arrangements; and recent absences from work including reason for absence, length of absence and type of leave taken. For further information on the content and methodology of the Working Arrangements Survey refer to Chapter 21.16.
Forms of Employment Survey
4.55 The Forms of Employment Survey (a supplement to the Labour Force Survey), collects detailed information on a range of aspects of employment arrangements including: the temporary nature of work; whether paid by an employment agency; and whether owner managers pay PAYE tax (or equivalent) or draw a wage or salary. The survey classified jobholders according to their working relationship/type of work undertaken (see discussion above) and collected detailed information about the characteristics of each group including: occupation, and industry in which they were employed; continuous duration in current job and expected future duration in current job; whether earnings vary; hours worked and paid for; and preferences to change hours. Additional information was collected for various classifications of work relationships/types of work:
4.56 For further information on the content and methodology of the Forms of Employment Survey refer to Chapter 21.3.
Survey of Employment Arrangements and Superannuation
4.57 As discussed previously, the Survey of Employment Arrangements and Superannuation also classifies jobholders according to their employment relationships/type of work undertaken and collects detailed information about jobholders' employment or working arrangements. Included in the survey are details of: superannuation; casual employment (based on leave entitlements and self-identification); occupation, industry and sector; the number and regularity of hours worked, additional hours/overtime, on call/stand-by, evening and weekend work, time in job/business and shift work; contract work; leave entitlements; occupational health and safety; home-based work; preferred working patterns; job duration and expected job duration; educational attainment; apprenticeships/traineeships; multiple jobholders; and trade union membership. For further information on the content and methodology of the Survey of Employment Arrangements and Superannuation refer to Chapter 23.
Locations of Work Survey
4.58 The Locations of Work Survey (a supplement to the Labour Force Survey), collects information on: where people work, such as their own home or employer's premises; and the working arrangements of persons who are working at home such as use of computers, time in job at home and information on how workers are paid. For further information on the content and methodology of the Locations of Work Survey refer to Chapter 21.8.
Employee Earnings, Benefits and Trade Union Membership Survey
4.59 The Employee Earnings, Benefits and Trade Union Membership Survey (a supplement to the Labour Force Survey), collects information on: employee earnings; trade union membership; and employee benefits. Information collected on employee benefits includes: entitlement to paid holiday leave, paid sick leave, paid long service leave and paid maternity/paternity leave; and superannuation coverage. More detailed information on the receipt of a range of other employee benefits (including transport, telephone, holiday expenses, medical, low interest finance, housing, goods and services) is collected on a five yearly basis. For further information on the content and methodology of the Employee Earnings, Benefits and Trade Union Membership Survey refer to Chapter 21.2.
4.60 For further details contact the Labour Market Statistics Section, on Canberra (02) 6252 7206.
1. The classification used in the 1998 Forms of Employment Survey differs slightly from the classification presented. Employees who were entitled to either paid holiday or sick leave (but not both) and who did not consider their job to be casual were classified as 'other employed persons'. Also classified as 'other employed persons' were: employees who were entitled to neither paid holiday leave nor paid sick leave and who did not consider their job to be casual; and owner managers of unincorporated enterprises who did not invoice or bill for own payment and paid Pay As You Earn tax. < back
2. Excluding employees who are paid only in kind. <back
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