INSIGHTS FROM THE ORIGINAL DATA


SAMPLE COMPOSITION

The Labour Force Survey sample can be thought of as comprising eight sub-samples (or rotation groups), with each sub-sample remaining in the survey for eight months, and one rotation group "rotating out" each month and being replaced by a new group "rotating in". This sample rotation is important in ensuring that seven-eighths of the sample are common from one month to the next, to ensure that changes in the estimates reflect real changes in the labour market, rather than the sample. In addition, the replacement sample is generally selected from the same geographic areas as the outgoing one, as part of a representative sampling approach.

When considering movements in the original estimates, it is possible to decompose the sample into three components:

• the matched common sample (survey respondents who responded in both April and May);
• the unmatched common sample (respondents in May but who did not respond in April, or vice versa); and
• the incoming rotation group (who replaced respondents who rotated out in April).

The detailed decomposition of each of these movements is included in the data cube 'Insights From the Original Data'.

In considering the three components of the sample, it is important to remember that the matched common sample describes the change observed for the same respondents between April and May, while the other two components reflect differences between the aggregate labour force status of different groups of people.

While the rotation groups are designed to be representative of the population, the outgoing and incoming rotation groups will almost always have somewhat different characteristics, as a result of the groups representing a sample of different households and people. The design of the survey, including the weighting and estimation processes, ensures that these differences are generally relatively minor and seeks to ensure that differences in characteristics of rotation groups do not affect the representativeness of the survey and its estimates. Monthly estimates are always designed to be representative of their respective months, regardless of the relative contribution of the three components of the sample.


INCOMING ROTATION GROUP

In original terms, the incoming rotation group in May 2016 had the same Employment to Population ratio as the group it replaced (60.8% in April and May 2016). The proportion of employed people who were employed full-time was similar to the group it replaced (68.2% in April 2016 and 68.5% in May 2016).

The proportion of men employed full-time was higher in the incoming rotation group when compared to the group it replaced (81.8% in April 2016 and 83.0% in May 2016). The proportion of women employed full-time was lower in the incoming rotation group when compared to the group it replaced (52.9% in April 2016 and 52.0% in May 2016).

The incoming rotation group had a slightly more negative influence on employment in South Australia than the group it replaced. The influence on employment in other States and Territories was similar to the group it replaced.


OUTGOING ROTATION GROUP

In looking ahead to the June 2016 estimates, the outgoing rotation group in May 2016, which will be replaced by a new incoming rotation group in June 2016, had a higher employment to population ratio (63.6% in May 2016) compared to the sample as a whole (61.4% in May 2016). The proportion of employed people who were employed full-time was 69.5% in the outgoing rotation group and 68.1% for the sample as a whole.

The unemployment rate for the outgoing rotation group in May 2016 was 4.6%, which was lower than for the 5.6% whole sample. The participation rate for the outgoing rotation group in May 2016 was 66.7%, higher than the 65.0% for the whole sample.


THE IMPORTANCE OF TREND DATA

As the gross flows and rotation group data are presented in original terms they are not directly comparable to the seasonally adjusted and trend data discussed elsewhere in the commentary, and are included to provide additional information for the original data. Since the original data are unadjusted, they have a considerable level of inherent sampling variability, which is specifically adjusted for in the trend series. The trend data provide the best measure of the underlying behaviour of the labour market and are the focus of the commentary in this publication.