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FEATURE ARTICLE 1: REGIONAL WAGE AND SALARY EARNERS IN WESTERN AUSTRALIA - 2001–02 TO 2003–04


INTRODUCTION

Western Australia has enjoyed a period of strong economic and population growth since 2001-02, underpinned by the state's booming construction and mining industries. Between 2001-02 and 2003-04, the Western Australian economy grew by an average of 6.2% per year and the population increased 1.4% (26,742 persons) per year. Rising employment opportunities and incomes have seen an influx of workers into the state, as well as a re-location of resident workers, both of which have brought about significant change in the distribution of wage and salary earners in Western Australia. Much of the recent growth in wage and salary earners has been concentrated in the outer metropolitan areas of Perth, inner Perth, Mandurah and areas surrounding Geraldton and Bunbury. The greatest increases in wage and salary incomes have been in the more affluent areas of Perth's inner west and in rejuvenated mining and other areas around Geraldton. Notably, the traditional mining areas of Kalgoorlie/Boulder, Coolgardie and East Pilbara have recorded relatively modest increases in wage and salary earners and incomes, albeit influenced by a high proportion of fly-in fly-out workers who may report their residence and income outside of these areas.

This analysis follows a previous article 'Regional wage and salary earners in Western Australia: 1996-97 to 2000-01' published in the March quarter 2004 issue of Western Australian Statistical Indicators (cat. no. 1367.5). Readers are directed to this article for information on data methodology, confidentiality, scope and coverage. Wage and salary earners are defined by the Australian Taxation Office as persons aged 15 years and over, who have submitted an individual income tax return and for whom wage and salary income was the principal source of income for the financial year. Wage and salary income includes gross income from wages and salaries, allowances, commissions, bonuses, tips, gratuities, consultation fees, honoraria and other payments for services. Throughout this article the term 'area(s)' is used to describe Statistical Local Areas (SLAs) of the Australian Standard Geographical Classification (cat. no. 1216.0), July 2006 edition.

METROPOLITAN AND NON-METROPOLITAN AREAS

From 2001-02 to 2003-04, the number of wage and salary earners grew 5.9% (43,255) to 771,395 in Western Australia, with the Perth metropolitan area accounting for over three quarters of the increase (up 6.2% or 34,271 to 583,862). Non-metropolitan wage and salary earners grew 5.4% (9,359) to 182,169. Average wage and salary incomes rose 10.1% ($3,497) to $38,284 per year in Western Australia between 2001-02 and 2003-04. For workers living in non-metropolitan areas, average wage and salary incomes rose 11.1% ($3,740), slightly more than for those living in metropolitan Perth (up 9.7% or $3,395). Despite the lower rate of growth, workers residing in metropolitan Perth still had higher average wage and salaries than workers residing outside of the Perth metropolitan area ($38,448 compared to $37,568 in 2003-04). However, the income disparity between the two areas narrowed from $1,224 in 2001-02 to $880 in 2003-04.

WAGE AND SALARY EARNERS, Western Australia
	2001-02	2002-03	2003-04	Change from 2001-02 to 2003-04	% change from 2001-02 to 2003-04
NUMBER
Perth metropolitan area	549 591	564 313	583 862	34 271	6.2
Non-metropolitan Western Australia	172 810	176 529	182 169	9 359	5.4
Total - Western Australia(a)	728 140	745 734	771 395	43 255	5.9
AVERAGE ANNUAL INCOME ($)
Perth metropolitan area	35 053	36 572	38 448	3 395	9.7
Non-metropolitan Western Australia	33 828	35 649	37 568	3 740	11.1
Total - Western Australia(a)	34 788	36 386	38 284	3 497	10.1
(a) Includes wage and salary earners and income not allocated to a region.
Regional Wage and Salary Earner Statistics, Australia, cat. no. 5673.0.

DISTRIBUTION OF WAGE AND SALARY EARNERS

A large concentration of wage and salary earners reside in Perth's urban fringe and along the south west corridor from Perth through to Rockingham and Mandurah. A large number also live in the major rural centres of Kalgoorlie/Boulder and Bunbury. Conversely, relatively few wage and salary earners reside in inland parts of Western Australia, where economic activity is limited or farming activity is prominent (farmers tend to be self employed workers, not wage and salary earners).

In 2003-04, Joondalup - South (49,198) had the largest number of wage and salary earners in Western Australia, followed by Melville (38,528) and Gosnells (37,338). Kalgoorlie/Boulder - Part A (14,144) and Bunbury (11,713) were the leading non-metropolitan areas. Rapid development along the south west corridor from Perth to Rockingham (30,290) and Mandurah (16,943) has also attracted large numbers of wage and salary earners. Very few wage and salary earners reside in the inland areas of Murchison (28), Sandstone (29), Menzies (47) and Kalgoorlie/Boulder - Part B ( 52).

NUMBER OF WAGE AND SALARY EARNERS, By SLA - Western Australia - 2003-04
	HIGHEST			LOWEST
	Joondalup - South	49 198		Murchison	28
	Melville	38 528		Sandstone	29
	Gosnells	37 338		Menzies	47
	Swan	37 140		Kalgoorlie/Boulder - Part B	52
	Stirling - Central	36 038		Westonia	65
	Canning	32 719		Cue	70
	Cockburn	30 592		Upper Gascoyne	71
	Rockingham	30 290		Woodanilling	71
	Stirling - Coastal	27 505		Nungarin	79
	Bayswater	23 999		Wandering	84
Regional Wage and Salary Earner Statistics, Australia, cat. no. 5673.0.

CHANGE IN THE DISTRIBUTION OF WAGE AND SALARY EARNERS

MAJOR INCREASES

Almost two thirds (65.2%) of all areas in Western Australia recorded an increase in wage and salary earners between 2001-02 and 2003-04 (101 of 155). The largest growth was recorded in Perth's outer metropolitan areas of Rockingham (3,131), Gosnells (3,032) and Swan (2,746). Mandurah (1,839) had the largest increase outside of the Perth metropolitan area. The fastest increase in wage and salary earners was recorded in Perth - Inner (45.3%), reflecting the rapid development of high density residential apartments and townhouses in and around the city centre. Aside from Perth, the fastest growth was in areas surrounding the major centres of Geraldton and Bunbury. Adjoining Geraldton, Greenough - Part B and Chapman Valley, recorded increases in wage and salary earners of 42.3% and 40.6% respectively, while a little further outside of Geraldton, Yalgoo (37.9%), also recorded a notable rise. Adjoining Bunbury, Capel - Part A, recorded a 40.4% increase in wage and salary earners. Conversely, the more traditional mining areas of Kalgoorlie/Boulder - Part A (1.9%), Coolgardie (6.6%) and East Pilbara (7.0%) recorded relatively lower rates of growth, partly reflecting the increased use of fly-in fly-out workers in these remote locations (fly-in fly-out workers may report their residence as being in other parts of the state).

NUMBER OF WAGE AND SALARY EARNERS, By SLA - Western Australia - Change from 2001-02 to 2003-04
	LARGEST INCREASE	no.		FASTEST INCREASE	%
	Rockingham	3 131		Perth - Inner	45.3
	Gosnells	3 032		Greenough - Part B	42.3
	Swan	2 746		Chapman Valley	40.6
	Cockburn	2 427		Capel - Part A	40.4
	Wanneroo - North West	2 032		Yalgoo	37.9
	Stirling - Central	1 972		Ngaanyatjarraku	33.1
	Wanneroo - North East	1 867		Perth - Remainder	29.3
	Wanneroo - South	1 851		Upper Gascoyne	29.1
	Mandurah	1 839		Wanneroo - North East	21.2
	Joondalup - North	1 635		Wanneroo - North West	20.6
Regional Wage and Salary Earner Statistics, Australia, cat. no. 5673.0.

MAJOR DECREASES

Just over one third (34.8%) of all areas in Western Australia recorded a decrease in wage and salary earners between 2001-02 and 2003-04 (54 of 155). Somewhat surprisingly, the largest decreases were in the more affluent areas of Cottesloe (132) and Nedlands (131), with Peppermint Grove (32) also showing a notable fall. These declines were however more likely a reflection of rising numbers of self employed workers in these areas, as well as an ageing population. All of the other areas in decline were located outside of the Perth metropolitan area, with Meekatharra recording the largest fall of 84 wage and salary earners. Meekatharra also showed the fastest decrease in wage and salary earners of 21.2%, followed by Tambellup (15.9%) and Dowerin (14.3%).

NUMBER OF WAGE AND SALARY EARNERS, By SLA - Western Australia - Change from 2001-02 to 2003-04
	LARGEST DECREASE	no.		FASTEST DECREASE	%
	Cottesloe	-132		Meekatharra	-21.2
	Nedlands	-131		Tambellup	-15.9
	Meekatharra	-84		Dowerin	-14.3
	Derby - West Kimberley	-73		Mullewa	-13.5
	Carnarvon	-71		Wickepin	-12.7
	Yilgarn	-68		Kent	-11.9
	Leonora	-55		Mount Magnet	-11.1
	Manjimup	-54		Yilgarn	-11.0
	Dalwallinu	-50		Dalwallinu	-10.9
	Wyndham - East Kimberley	-39		Leonora	-9.6
Regional Wage and Salary Earner Statistics, Australia, cat. no. 5673.0.

DISTRIBUTION OF WAGE AND SALARY INCOMES

A relatively low proportion of areas in Western Australia had wage and salary incomes above the state average. In 2003-04, less than one quarter of areas in Western Australia (34 of 155) reported average wage and salary incomes above the state average of $38,284 per year. The highest annual incomes were reported in areas of Perth's inner west, including Peppermint Grove ($60,364), Cottesloe ($60,287), Nedlands ($57,279), Claremont ($56,988) and Subiaco ($53,284). The proportion of residents earning more than $52,000 per year in wage and salary income was much higher in Cottesloe (40.9%), Peppermint Grove (40.8%), Subiaco (40.8%) and Nedlands (39.6%) than across the state as a whole (25.3%). The major mining areas of Ashburton, Sandstone, Roebourne, East Pilbara and Leonora also recorded wage and salary incomes well above the state average, ranging from $57,141 in Ashburton to $51,890 in Leonora. Notably, one third (34.0%) of wage and salary earners in Ashburton earned more than $78,000 per year.

Wheatbelt and other inland areas of Western Australia had the lowest wage and salary incomes in the state. In 2003-04, Wickepin ($23,657), Tammin ($25,437), Westonia ($25,765), Narembeen ($26,039) and Yalgoo ($26,389) recorded average annual wage and salaries well below the state average. These results should, however, be interpreted with some caution given the high proportion of self employed workers and other atypical workforce characteristics in these areas.

AVERAGE ANNUAL WAGE AND SALARY INCOME, By SLA - Western Australia - 2003-04
	HIGHEST	$		LOWEST	$
	Peppermint Grove	60 364		Wickepin	23 657
	Cottesloe	60 287		Tammin	25 437
	Nedlands	57 279		Westonia	25 765
	Ashburton	57 141		Narembeen	26 039
	Claremont	56 988		Yalgoo	26 389
	Sandstone	54 382		Perenjori	26 609
	Roebourne	54 186		Mukinbudin	27 068
	East Pilbara	53 538		Kent	27 073
	Subiaco	53 284		Kondinin	27 084
	Leonora	51 890		Brookton	27 143
Regional Wage and Salary Earner Statistics, Australia, cat. no. 5673.0.

CHANGE IN THE DISTRIBUTION OF WAGE AND SALARY INCOMES

MAJOR INCREASES

The vast majority (96.1%) of areas in Western Australia recorded growth in average annual wage and salary income between 2001-02 to 2003-04. The largest increases were in Perth's inner west, mining regions and areas surrounding Geraldton. Sandstone recorded the highest growth in average wage and salaries of $13,069, followed by Peppermint Grove ($10,209) and Cottesloe ($10,135). Sandstone also had the fastest rise in average wage and salaries of 31.6% over the two year period, followed by other areas surrounding Geraldton: Chapman Valley (24.2%), Mingenew (23.8%), Victoria Plains (23.1%) and Mount Marshall (20.6%). In recent times, gold mining has re-emerged as the principal industry in Sandstone, while many people have re-located to other areas around Geraldton to work in local industries or commute to Geraldton for work. Carnamah ($5,994), another area near Geraldton, has also had a major rise in wage and salary incomes, supported by heavy mineral sands mining activity in the area.

AVERAGE ANNUAL WAGE AND SALARY INCOME, By SLA - Western Australia - Change from 2001-02 to 2003-04
	LARGEST INCREASE	$		FASTEST INCREASE	%
	Sandstone	13 069		Sandstone	31.6
	Peppermint Grove	10 209		Chapman Valley	24.2
	Cottesloe	10 135		Mingenew	23.8
	Roebourne	7 488		Victoria Plains	23.1
	Nedlands	7 189		Mount Marshall	20.6
	Claremont	6 923		Trayning	20.6
	Chapman Valley	6 418		Peppermint Grove	20.4
	Victoria Plains	6 126		Cottesloe	20.2
	Mingenew	5 997		Broomehill	20.0
	Carnamah	5 994		Kondinin	19.6
Regional Wage and Salary Earner Statistics, Australia, cat. no. 5673.0.

MAJOR DECREASES

Only six areas in Western Australia experienced a fall in average annual wage and salary incomes between 2001-02 and 2003-04. All of these areas were located in inland parts of the state where very few wage and salary earners reside. The largest fall in average wage and salaries was recorded in Cue ($6,361), followed by Ngaanyatjarraku ($3,929), Murchison ($3,750) and Yalgoo ($2,360). These four areas also recorded the fastest decrease in wage and salary incomes: Cue (17.4%), Murchison (11.9%), Ngaanyatjarraku (10.2%) and Yalgoo (8.2%).

AVERAGE ANNUAL WAGE AND SALARY INCOME, By SLA - Western Australia - Change from 2001-02 to 2003-04
	LARGEST DECREASE	$		FASTEST DECREASE	%
	Cue	-6 361		Cue	-17.4
	Ngaanyatjarraku	-3 929		Murchison	-11.9
	Murchison	-3 750		Ngaanyatjarraku	-10.2
	Yalgoo	-2 360		Yalgoo	-8.2
	Wiluna	-833		Wiluna	-2.6
	Westonia	-309		Westonia	-1.2
Regional Wage and Salary Earner Statistics, Australia, cat. no. 5673.0.

INFLUENCE OF SEX, AGE AND OCCUPATION ON WAGE AND SALARY INCOME

The workforce characteristics of sex, age and occupation have an influence on wages and salaries earned across Western Australia. Statistical evidence supports that, generally, workers who are male, above 35 years of age and employed in more skilled occupations tend to earn higher incomes than workers who are female, below 35 years of age and employed in less skilled occupations.

In Western Australia, 35.3% of male wage and salary earners earned in excess of $52,000 per year in 2003-04, compared to only 10.0% of females. Furthermore, 39.0% of female wage and salary earners earned less than $20,800 per year, compared to only 19.7% of males. In terms of age, wage and salary earners aged 35 and over had the highest proportion of workers (30.9%) earning in excess of $52,000 per year in 2003-04 and a low proportion earning less than $20,800 per year (20.2%). For those aged 15-34, only 14.0% earned above $52,000 per year and 39.7% earned less than $20,800 per year in 2003-04. This average was strongly influenced by wage and salary earners aged 15-24, with only 2.8% earning greater than $52,000 per year and 59.8% earning less than $20,800 per year.

At the broadest level of the Australian Standard Classification of Occupations (cat. no. 1220.0), managers and administrators, professionals, associate professionals, and tradespersons and related workers are considered to be the highest skilled occupations. In 2003-04, 36.7% of wage and salary earners in these occupations combined earned above $52,000 per year and only 15.7% earned less than $20,800 per year. This compared to 11.5% earning above $52,000 per year and 40.0% earning below $20,800 per year for the remaining occupations combined.

WAGE AND SALARY EARNERS, By sex, age, occupation and income range - Western Australia - 2003-04
	$0 to less than $20,800		$20,800 to less than $52,000		$52,000 and over		Total
	no.	%	no.	%	no.	%	no.	%
SEX
Male	81 347	19.7	185 274	44.9	145 579	35.3	412 200	100.0
Female	140 110	39.0	183 140	51.0	35 937	10.0	359 187	100.0
Total - Western Australia(a)	221 457	28.7	368 414	47.8	181 516	23.5	771 387	100.0
AGE
15-24	92 328	59.8	57 587	37.3	4 379	2.8	154 294	100.0
25-34	41 021	22.6	97 819	53.9	42 484	23.4	181 324	100.0
35-44	38 843	21.4	83 891	46.3	58 557	32.3	181 291	100.0
45-54	29 816	17.9	83 321	50.0	53 505	32.1	166 642	100.0
55 and over	19 485	22.2	45 777	52.1	22 640	25.8	87 902	100.0
Total - Western Australia(a)	221 457	28.7	368 414	47.8	181 516	23.5	771 387	100.0
OCCUPATION
Managers and administrators	6 439	10.6	27 033	44.6	27 147	44.8	60 619	100.0
Professionals	21 051	15.1	63 072	45.1	55 623	39.8	139 746	100.0
Associate professionals	9 843	17.0	29 501	51.0	18 480	32.0	57 824	100.0
Tradespersons and related workers	16 825	19.6	43 805	51.1	25 077	29.3	85 707	100.0
Advanced clerical and service workers	5 267	25.9	13 063	64.3	1 989	9.8	20 319	100.0
Intermediate clerical, sales and service workers	49 006	37.2	72 362	54.9	10 347	7.9	131 715	100.0
Intermediate production and transport workers	10 567	18.2	27 995	48.3	19 414	33.5	57 976	100.0
Elementary clerical, sales and service workers	43 660	60.3	26 997	37.3	1 782	2.5	72 439	100.0
Labourers and related workers	33 153	46.3	31 351	43.8	7 140	10.0	71 644	100.0
Total - Western Australia(a)(b)	221 457	28.7	368 414	47.8	181 516	23.5	771 387	100.0
(a) Component items may not sum to totals due to cells being randomly adjusted to avoid the release of confidential data.
(b) Includes the category 'Not stated'.
Regional Wage and Salary Earner Statistics, Australia, cat. no. 5673.0.

Given these relationships, changes in the characteristics of an area's workforce can have a pronounced effect on average wage and salaries earned in an area. The following section investigates areas of Western Australia showing major workforce changes between 2001-02 and 2003-04 and the impact it has had on average wages and salaries. Areas with less than 2,000 wage and salary earners were excluded from the analysis, given the exaggerated effect on average incomes of workforce changes in areas with very few wage and salary earners.

MAJOR CHANGES IN WORKFORCE COMPOSITION

SEX

Perth's inner west and major mining areas of Western Australia recorded the largest movements in the ratio of male-female wage and salary earners between 2001-02 and 2003-04. The ratio of male to female workers rose substantially in Cottesloe (1.08 to 1.14), Collie (1.55 to 1.59), Murray (1.30 to 1.33), Roebourne (1.39 to 1.42) and Port Hedland (1.39 to 1.41). The largest decreases were recorded in Ashburton (1.60 to 1.53), Mosman Park (1.06 to 1.00), East Pilbara (1.52 to 1.46), Claremont (1.09 to 1.03) and Dardanup - Part A (1.36 to 1.30). These areas of Western Australia also showed significant change in wage and salary incomes over the period.

RATIO OF MALE TO FEMALE WAGE AND SALARY EARNERS, SLAs(a) with largest increases and decreases: Western Australia

AGE

Very similar areas of Western Australia recorded major changes in the age profile of wage and salary earners between 2001-03 and 2003-04. The largest increases in the ratio of wage and salary earners aged 35 and above to those aged 15-34 were reported in Cottesloe (1.17 to 1.32), Collie (1.59 to 1.73), Broome (0.97 to 1.10), Harvey - Part B (1.34 to 1.47) and East Fremantle (1.71 to 1.83). The largest decreases in the age ratio were recorded in Ashburton (1.25 to 1.12), Mosman Park (1.44 to 1.36), Cambridge (1.39 to 1.34), Subiaco (1.36 to 1.32) and East Pilbara (1.45 to 1.41).

RATIO OF 35+ TO 15-34 AGED WAGE AND SALARY EARNERS, SLAs(a) with largest increases and decreases: Western Australia

OCCUPATION (OR SKILLS)

Changes in the mix of occupations (or skills) across Western Australia's workforce has also influenced wages and salaries earned across the state. Areas gaining more skilled workers (or losing less skilled workers) have tended to see stronger income growth than those areas losing more skilled workers (or gaining less skilled workers). For the purposes of this analysis, skilled occupations are: managers and administrators; professionals; associate professionals; and tradespersons and related workers. Less skilled occupations are: advanced clerical and service workers; intermediate, clerical, sales and service workers; intermediate production and transport workers; elementary, clerical, sales and service workers; and labourers and related workers.

Areas of metropolitan Perth and south west Western Australia showed the largest changes in the occupations of wage and salary earners in the state. Between 2001-02 and 2003-04, the ratio of skilled to less skilled wage and salary earners rose substantially in Cottesloe (2.21 to 2.38), Perth - Remainder (1.47 to 1.62), East Fremantle (1.77 to 1.88), Claremont (1.86 to 1.97) and Kalgoorlie/Boulder - Part A (0.86 to 0.95) . The largest declines in the ratio of skilled to less skilled workers were in Augusta-Margaret River (1.01 to 0.83), Mosman Park (1.74 to 1.57), Albany - Balance (0.91 to 0.83), Albany - Central (0.91 to 0.84) and Mundaring (1.09 to 1.03).

RATIO OF SKILLED TO LESS SKILLED WAGE AND SALARY EARNERS, SLAs(a) with largest increases and decreases: Western Australia