6150.0 - Australian Labour Account: Concepts, Sources and Methods, June 2018
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 26/06/2018
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Additional hours sought by underemployed
Deductions are made for:
Adjustments to hours actually worked in all jobs
Adjustments to hours actually worked in all jobs are the additions and deductions made to hours worked to align the scope of the Labour Force Survey with Australian System of National Accounts concepts of production and residency.
Additions are made for hours actually worked by:
Deductions are made for hours actually worked by:
Available hours of labour supply
Available hours of labour supply refer to the total number of hours spent directly on and available to be spent on, and in relation to, productive activities. It is the aggregate of hours actually worked, and hours sought but not worked.
Average hours actually worked per job
Average hours actually worked per job are the hours actually worked divided by all filled jobs.
Average labour cost per hour paid
Average labour cost per hour paid is the total labour cost divided by hours paid for.
Average labour cost per hour worked
Average labour cost per hour worked is the total labour cost divided by hours actually worked in all jobs.
Average labour income per employed person
Average labour income per employed person is the total labour income divided by the number of employed persons.
Compensation of Employees
Compensation of Employees is defined as the total remuneration, in cash or in kind, payable by an enterprise to an employee in return for work done by the employee (2008 SNA, para 7.5, ASNA 11.6). It is the value of entitlements received by employees from employers for services rendered. It is further classified into two sub components: Wages and salaries, and Employers’ social contributions.
Contributing family workers
Contributing family workers are persons who work without pay in an enterprise operated by a relative.
Employees are persons who work for a public or private employer and receive remuneration in wages, salary, a retainer fee from their employer while working on a commission basis, tips, piece-rates, or payment in kind. Employees are engaged under a contract of service (an employment contract) and take directions from their employer/supervisor/manager/foreman on how work is performed.
Employers’ social contributions
Employers’ social contributions are payments by employers which are intended to secure for their employees the entitlement to social benefits should certain events occur, or certain circumstances exist, that may adversely affect their employees’ income or welfare – namely work related accidents and retirement.
Employment subsidies are any government wage subsidies an employer may receive.
Filled jobs refer to all positions of employment that are currently filled (including self-employment). Filled jobs can be measured from either household sources (such as the Labour Force Survey), or business sources (such as the Economic Activity Survey).
Hours actually worked in all jobs
Hours actually worked in all jobs includes:
Hours actually worked in all jobs excludes:
For multiple job holders, actual hours worked includes the hours worked in all jobs.
Hours paid but not worked
Hours paid but not worked refers to hours associated with paid leave, such as annual leave, paid public holidays, paid sick leave and other types of paid leave.
Hours paid for
Hours paid for is the time for which payment has been received for award, standard or agreed hours of work (paid at normal or premium rates, in cash or in kind), regardless of whether the hours were actually worked or not.
Hours paid for:
As such, hours paid for will differ from the number of hours actually worked if an employee works more or less hours than their paid hours. Hours paid for will also differ from usual hours in some cases, for example if an employee performs long hours in some weeks to have rostered days or weeks off. Hours paid for is the aggregate of ordinary time hours paid for and overtime hours paid for.
Hours sought but not worked
Hours sought but not worked refers to the number of hours a person would prefer to work and is available to work beyond the usual hours they do work. It is the sum of hours sought by unemployed, and additional hours sought by underemployed.
Hours sought by unemployed
Hours sought by unemployed refers to the number of hours an unemployed person would prefer to work and is available for.
Hours worked but not paid
Hours worked but not paid refers to unpaid hours worked. It is the time (hours) worked but not paid for by the employer, such as unpaid overtime, and absences that are not paid by the employer, such as unpaid educational leave or maternity leave that may be paid through transfers by government from social security systems.
A job with job sharing arrangements is a full-time job that is filled by employing two or more people working part-time to share the responsibility and duties of the one position.
A job vacancy is an unfilled job that an employer intends to fill either immediately or in the near future. A job vacancy is considered to exist if an employer has taken concrete steps to find a suitable person to carry out a specific set of tasks and would have recruited (entered into a job contract with) such a person if she/he had been available.
Measures of job vacancies exclude:
Labour Account added as a prefix to a data item (e.g. Labour Account main job and Labour Account secondary job) is indicative of statistical estimates where an adjustment is made to address scope discrepancies between the principal data sources (such as the household Labour Force Survey) and the conceptual scope of the Australian Labour Account (the Australian System of National Accounts production and residency boundaries). For example, the number of filled jobs reported in the Labour Force Survey is adjusted by adding estimates of jobs held by members of the permanent defence forces, child workers and short-term visa holders, and deducting an estimate of Australian residents employed by non-resident enterprises.
Labour Account employed persons
Labour Account employed persons is the sum of all persons engaged by Australian resident enterprises in economic activity within the Australian System of National Accounts production boundary.
Labour Account labour force
The labour force, also referred to as the currently economically active population, is the aggregate of employed and unemployed persons and gives a measure of the number of people contributing to, or actively looking and immediately available for, the supply of labour at a point in time. Labour Account labour force total is the sum of Labour Account employed persons and Labour Force Survey unemployed persons.
Labour Account main job
Labour Account main job is the main activity carried out by an employed person. In the Australian context, this is the job in which most hours are usually worked. An employed person can only have one main job.
Labour Account secondary job
Labour Account secondary job is any job held by an employed person, other than main job. A person can have multiple secondary jobs.
Labour Force Survey employed persons
Labour Force Survey employed persons is the sum of all persons, defined as employed in line with ILO guidelines and in ABS official employment statistics (Labour Statistics: Concepts, Sources and Methods, cat. no. 6102.0.55.001).
An employed person must meet the following criteria:
Members of the permanent defence forces, certain diplomatic personnel of overseas governments customarily excluded from census and estimated population counts, overseas residents in Australia, and members of non-Australian defence forces (and their dependents) stationed in Australia are excluded from the Labour Force Survey.
Labour Force Survey main job
Labour Force Survey main job is the number of main jobs held by members of the usually resident civilian population aged 15 years and over. This is the official estimate of the number of main jobs derived from data collected in the household Labour Force Survey and published in Labour Force, Australia (cat. no. 6202.0).
Labour Force Survey not in the labour force
Labour Force Survey not in the labour force comprises all persons aged 15 years and over who are neither employed nor unemployed. They include people who perform home duties or care for children, were retired, voluntarily inactive and those permanently unable to work. Not all people who are classified as not in the labour force are voluntarily economically inactive; some want to work but are classified as not in the labour force because they do not satisfy the criteria for unemployment (active job search and availability to start work).
Labour Force Survey secondary job
Labour Force Survey secondary job is the number of secondary jobs held by members of the usually resident civilian population aged 15 years and over. This is the official estimate of the number of secondary jobs derived from data collected in the household Labour Force Survey.
Labour Force Survey underemployed persons
Labour Force Survey underemployed persons reflects insufficient hours of work and where a person is willing and available to engage in additional hours of employment. International guidelines recognise underemployment in two forms: time related underemployment (persons who would prefer more hours) and inadequate employment situations, which represents insufficient use of skills and experience; inadequate income; and excessive hours.
Time related underemployed persons refer to part-time employed persons who wanted to work more hours and were available to start work with more hours, either in the reference week or in the four weeks subsequent to the survey; or persons employed full-time who worked part-time hours in the reference week for economic reasons. It is assumed that these people wanted to work full-time in the reference week and would have been available to do so.
Consistent with the Labour Force Survey, the Australian Labour Account only includes measures of time related underemployment.
Labour Force Survey underutilised persons
Labour Force Survey underutilised persons encapsulates both unemployment and underemployment, and provides more comprehensive information on the state of labour market and measures the extent to which all available labour force resources are not being fully used in the economy.
Labour Force Survey unemployed persons
Labour Force unemployed persons refers to people in the civilian usually resident population aged 15 years and over who are without work, actively seeking work and currently available for work. All three conditions must be satisfied for a person to be considered unemployed. For people waiting to start a new job they have already obtained, the active job search criterion is waived.
Labour income from self-employment
Labour income from self-employment refers to the employment related income received by household members from self-employment. It consists of all payments and benefits in cash, kind or services, which are received, over a given reference period, by individuals for themselves or in respect of their family members, by virtue of their involvement in current or former self-employment jobs.
Ordinary time hours paid for
Ordinary time hours paid for includes stand-by or reporting time hours which are part of standard hours of work, and hours of paid annual leave, paid sick leave and long service leave taken during the reference period. Ordinary time hours paid for at penalty rates (e.g. for shift work) are not converted to their ordinary time equivalent. This definition excludes any hours unpaid and overtime hours.
Other employment related costs to employers
Other employment related costs to employers relates to costs other than compensation of employees attributed to employees, such as training cost and recruitment costs.
Owner-Managers of Incorporated Enterprises (OMIEs)
Owner-Managers of Incorporated Enterprises (OMIEs) are persons who operate their own incorporated enterprise with or without hiring employees.
Owner-Managers of Unincorporated Enterprises (OMUEs)
Self-employed (Owner-Managers of Unincorporated Enterprises (OMUEs)) are persons who operate their own unincorporated enterprise with or without hiring employees.
Paid overtime, otherwise known as overtime hours paid for, represents hours paid for in excess of award, standard or agreed hours of work, at both standard and penalty rates.
Payroll tax includes taxes payable by the employer on the wage and salary bill.
Residual (Labour Payments quadrant)
Residual in the Labour Payments quadrant refers to the difference between ‘total labour income’ and ‘total labour costs’. This is not a statistical discrepancy, and the two measures are similar but not conceptually identical.
Residual (Labour Volume quadrant)
Residual in the Labour Volume quadrant refers to the difference between ‘hours paid for’ and ‘hours worked’. This is not defined as a statistical discrepancy as there remains a data gap in terms of unpaid hours worked.
This residual can provide an insight into labour market conditions. An industry in which the gap between hours paid for and hours worked is below the average for the economy as a whole is likely to be indicative of more casual employment arrangements, in which employees have less access to benefits such as paid recreation and sick leave. A reduction over time in the gap between hours paid for and hours worked could signal a tightening of labour market conditions or an increase in casual employment
Secondary employment adjustment
The secondary employment adjustment calculates the number of employed people who hold secondary jobs in each industry. It is calculated by excluding multiple job holding within the same industry, from the total number of filled jobs.
The statistical discrepancy is equal to filled jobs from the business side less filled jobs from the household side, after addressing scope discrepancies. These two measures are, in principle, the same. The statistical discrepancy reflects measurement error associated with the source data, or modelling error within the Australian Labour Account.
Total jobs refers to all positions of employment that are currently filled, or are vacant and could be filled. It is the aggregate of the number of filled jobs and the number of job vacancies.
Total labour costs
Total labour costs refers to all costs incurred by the employer in the employment of labour. It is further classified into two sub components: Compensation of employees and other labour related costs to employers.
Total labour income
Total labour income refers to the employment related income received by households from all paid employment. It consists of all payments and benefits in cash, kind or services, which are received, over a given reference period, by individuals for themselves or in respect of their family members, by virtue of their involvement in current or former paid employment jobs.
Wages and salaries
Wages and salaries (internationally referred to as earnings) relates to regular and irregular remuneration in cash and in kind paid to employees for time worked or work done together with remuneration for time not worked, such as annual vacation and other paid leave or holidays (ASNA 11.8).
Wages and salaries is further classified into two categories: wages and salaries paid in cash, and wages and salaries paid in kind. Conceptually wages and salaries excludes severance and termination pay, which, along with, sick leave payments; and payments for other forms of leave other than annual leave and long service leave should be classified as employers' social contributions as recommended by the SNA 2008. However, as data providers in Australia are unable to consistently differentiate between these various types of severance and leave payments, and other wage and salary payments, these payments are included in the Australian System of National Account estimates of wages and salaries. Fringe benefits taxes which are payable on income in kind provided to employees are included as part of wages and salaries and also included in income taxes payable by households.
Payments to members of the defence forces consist of salaries and allowances, attendance pay and the value of food, clothing, and travel supplied to permanent members, reserves and cadets. Deferred pay is included but war gratuities, which are regarded as social assistance benefits, are not.
Wages and salaries also include changes in provisions for future employee entitlements, such as provisions for long service leave.
Wages and salaries paid include the values of any social contributions (e.g. to superannuation funds), income taxes, etc., payable by the employee even if withheld by the employer for administrative convenience, such as direct payment to a superannuation fund or the Australian Taxation Office (ATO). Also included are penalty payments (e.g. overtime, hazardous work allowances), supplementary allowances such as housing and meal allowances (unless paid as social benefits), holiday pay, payment while on sick leave, bonuses, and commissions, tips and gratuities paid directly to the employee by a third party.
Wages and salaries paid in kind
Wages and Salaries paid in kind covers the cost to an employer of goods and services which are provided to the employee, or to another member of the employee's household, free of charge or at a substantial discount, and which are clearly of benefit to the employee as a consumer. Examples include meals, housing, uniforms that can be worn away from work, vehicles available for personal use, goods and services produced by the employer enterprise, recreational facilities, transportation, car parking, child care, low interest loans and stock options. Some of these benefits may appear more like intermediate consumption, but are included in compensation of employees because, even though they are paid to attract employees, they are benefits that employees would often have to provide themselves.
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