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SPOTLIGHT: INSIGHTS INTO DETAILED LABOUR FORCE HOURS WORKED DATA
It is for this reason that hours worked analysis can provide an early indication of aggregate labour market impacts from any major disruption to the economy, ahead of changes in other Labour Force indicators.
Measuring changes in the number of hours worked is critical to an effective understanding of how the labour market is changing over time. However, hours worked data reflect a high degree of systematic seasonal factors and effects, many of which are closely related to public holidays, school holidays and other major events in the year (eg. Christmas).
For this reason, the ABS produces trend and seasonally adjusted series to provide insights into how aggregate hours worked within the labour market are changing over time. These series adjust for the seasonality in the underlying original data, and also convert the weekly hours measures into hours representing the entire month.
This enables analysis of total hours worked in the month alongside employment. For example, the three charts below show annual growth rates in trend employment and trend monthly hours worked for all people, males and females.
These charts show that hours worked growth rate for females has remained relatively strong over the past three years, usually around or above the growth rate for employment. In contrast, the growth rate for hours worked for males has been slowing more quickly than employment for the past two years, with trend hours worked now declining.
Chart 1: Year on year trend growth in total employed and hours worked
Chart 2: Year on year trend growth in male employed and hours worked
Chart 3: Year on year trend growth in female employed and hours worked
Source: 6202.0 Tables 1 and 19
Original hours worked data: a compositional view
Released in the week following the headline Labour Force aggregate measures, the detailed monthly and quarterly Labour Force releases (6291.0.55.001 and 6291.0.55.003) contain additional hours worked data, in original terms. Care should be taken in interpreting month-to-month changes in the detailed original data, given the systematic seasonality in hours worked data. Detailed data for specific sub-populations will also be inherently more volatile than higher level aggregates, and the ABS generally recommends using smoothing techniques when using very detailed data.
Much of the analysis presented in the remainder of this spotlight focuses on February data, and how February 2020 compares with February data from the 2015-2019 period. The year-on-year comparison approach helps to control for the effects of seasonality in the original data.
Every month the ABS releases information on the number of people working in different groups of hours worked, by various characteristics. Table 1 below shows the distribution of employed males and females across the hours worked categories, over the past 5 years. The data shows that, over the past 5 years:
Table 1: Proportion of hours worked by male and females
Information is also available on the number of people working less hours than usual, which may provide an early indication that hours declined due to COVID-19. Chart 4 presents this information as an original data time series for the past 5 years, and shows that there was not a notable change in February 2020.
Chart 4 : In original terms, total employed who worked less than usual hours
Source: 6291.0.55.001 Data Cube EM2a
In the Labour Force Survey, when someone responds that they worked less than their usual hours, they are asked for the reason they worked fewer hours. Table 2 below shows that the most common reason people worked fewer hours in February 2020 was because they were taking annual leave, holidays, flextime or long service leave. 15% of people were working fewer hours than usual due to illness, injury or sick leave, while 17% of people cited standard work arrangements (including shift work) as the reason they were working fewer hours. This is similar to proportions in February 2019.
Table 2 : Percent of employed who worked fewer hours than usual, February 2020
People affected by the impacts of COVID-19 may fall into the following categories in the coming months:
Table 3: Reasons people worked less than usual hours - monthly movements
Looking at the time series in original terms can provide additional insights into patterns in the labour market over time. For example, Chart 5 shows distinct seasonal patterns related to the cold and flu seasons in Australia in the winter months. If people begin to take sick leave due to COVID-19, then there may be an increase in the number of people in this category and a more pronounced seasonal pattern.
Chart 5 : Employed who worked less than usual hours - Own illness or injury or sick leave
Source: 6291.0.55.001 Data Cube EM2a
Quarterly hours worked information
The quarterly detailed labour Force release (cat. no. 6291.0.55.003) contains hours worked information by industry, occupation, and range of other characteristics.
Analysis of hours worked data by industry did not identify any unusual movements in February 2020 that would suggest an early indication of COVID-19 impacts.
Chart 6 below shows the hours worked for three industries which may potentially be impacted early by COVID-19. For each of these three industries, the hours worked series largely reflects existing patterns. This was also true for all industries in February 2020.
Chart 6 : Number of hours actually worked in all jobs, Original
Source: 6291.0.55.003 Table 11
In future quarters, the ABS will also undertake analysis of reasons people worked less than usual hours by industry or groups of industries (following a similar approach to that taken inTable 3).
The ABS will also be undertaking analysis of hours worked by industry in the quarterly Labour Account (cat. no. 6150.0.55.003), given it is the best source of industry information. March quarter Labour Account estimates will be released in June 2020.
Beyond hours worked information, other detailed Labour Force products will also be important in monitoring and understanding impacts to labour force status. This data includes information on:
Other products beyond the core Labour Force products may also provide important information over the coming months, or assist in understanding the number of people who may be more affected by the labour market impacts of COVID-19. For example Characteristics of Employment (cat. no. 6333.0) contains information regarding employee earnings and working arrangements.
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