These weekly estimates are part of a suite of new products the ABS are releasing to provide up-to-date information on the impact of the COVID-19 coronavirus on people and businesses in Australia. This release provides indicative information on the economic impact of the COVID-19 coronovirus on employees, including changes in employee jobs, changes in total wages, and changes in average weekly wages per job.
Source
These weekly estimates are derived from Single Touch Payroll (STP) data, which is provided to the Australian Taxation Office (ATO) by businesses with STP-enabled payroll or accounting software each time the business runs its payroll. STP data includes both business and job level tax information and superannuation information. The data are combined with other administrative data from the Australian taxation system to determine additional classification attributes, such as the age and sex of employees.
The ABS would like to acknowledge the critical support from the Australian Taxation Office (ATO) in enabling the ABS to produce these statistics.
Scope
All employee jobs reported to the ATO through STP are in scope of these estimates.
An employee job is a relationship between an employed person and their employing enterprise, where the employee has received a payment in the reference week through STP-enabled software and reported to the ATO.
Owner managers of unincorporated enterprises are not included in these estimates as they are not in scope of STP-enabled software reporting to the ATO.
As at 6 April 2020, approximately 99% of employers the ATO classifies as ‘substantial employers’ (those with 20 or more employees) were reporting through STP. Small employers (those with 19 or less employees) began transitioning to STP on 1 July 2019 and by 6 April 2020 approximately 71% were reporting through STP. As a result, not all jobs in the Australian labour market are captured within these estimates.
The estimates are considered experimental and only provide an indication of movements in total jobs and total wages (rather than level estimates), for the purpose of assessing the economic impact of the COVID-19 coronavirus on employees.
Frequency and duration
These estimates will be published fortnightly on Tuesdays during the COVID-19 coronavirus period. The timing has been optimised around when the largest proportion of both weekly and fortnightly payments are made (thereby minimising the contribution from imputation at the end point of the series).
These estimates have a 17 day time lag after the reference week. While estimates are published fortnightly, weekly data are available within the release.
Coverage
These estimates are available by state and territory, and at the national level. All geographic variables are based on the individual's residential address as stated on their income tax return. Where an address is not available from the income tax return the residential address as reported on the STP file is used.
Estimates are also provided for the 19 Australia and New Zealand Standard Industry Classification (ANZSIC) divisions. All industry variables are based on the ABS Statistical Business Register.
Methodology
Calendarisation
STP data is reported on a year-to-date cash accounting basis at the time the payment was provided to an employee rather than at the time the payment was earned. To produce indicative real time estimates of wages and jobs, the calendarisation method is used to convert STP data from a cash basis to an accrual basis.
The calendarisation method uses the start and end date of the payment period reported through STP to calculate the payment frequency, known as ‘periodicity’. A daily pay rate is then calculated by dividing the total payment by the total number of days in the payment periodicity. For example, a payment made weekly will be divided by seven to calculate a daily pay rate. Where the commencement or termination date for a job occurs within a payment period, the periodicity for that job is adjusted to exclude the days before commencement or after termination.
Imputation
Payment data extracted from the STP system each week is always partially incomplete, given businesses have different payment frequencies. For example, a business with a fortnightly payroll will only provide STP data every second week. To produce reliable, unbiased weekly statistics, an imputation method is used to account for differing reporting patterns.
If an employee has not yet had payment data reported and they have not been flagged for termination, it is assumed that their payment status is consistent with their previous reporting record. The previous calculated daily rate will be imputed for the current period.
As at 13 April 2020, the data indicates that 38% of employees are paid weekly; 47% are paid fortnightly; 11% paid monthly; 4% are paid quarterly or paid infrequently.
No imputation is required for employees paid weekly. Business reported data is included for all employees paid weekly due to the 17 day lag between the reference week and the release of estimates. Actual payments for most employees paid fortnightly and some employees paid monthly are also available.
Imputation is not applied for the small proportion of employees who are paid quarterly or infrequently as there is not an established pattern of payment to extrapolate forward.
No imputation is applied for new employees without historical payment information, until a pattern can be determined.
Aggregation
Once STP data is converted to an accrual basis using the calendarisation method and imputation is applied, the data is aggregated to produce the following weekly estimates:
- Total Employee Jobs: The average of the 7 days of employee counts.
- Total Wages: The sum of all daily rates for all jobs for the week. This is the total value of wages for the week.
- Average weekly wage by job: This is calculated by dividing the total wages value by the total employee jobs number.
Revisions
The data underlying these estimates are revised for each release, and reflected in percentage change movements and indexes.
Revising underlying data across the time series allows the estimates to incorporate newly available business reported data and replace previously imputed data with actual data.
Time series estimates
The estimates are presented as an original series only. Seasonally adjusted and trend estimates are not yet available. A number of years of data will be required before seasonal patterns can be observed and adjusted for.
The calendarisation and imputation methodologies applied to the estimates account for calendar related variations, such as the number of days in a month, and different payment frequencies.
Note: All estimates presented in this publication are presented for weeks ending on a Saturday.
Summary of outputs
Estimates are produced for weekly change in the number of jobs, change in wages and change in average weekly wage by job. These estimates are available at the national, state and territory and ANZSIC division level by selected personal attributes, including sex and 10 year age groups. Estimates are presented as percentage change movements and indexes.
Indexed number of jobs and total wages
The estimates include indexes to present changes in the labour market during the COVID-19 coronavirus period.
In order to compare changes over time, the week Australia recorded its 100th confirmed coronavirus case (i.e. week ending 14th March 2020) is used as the reference period for constructing the indexes and given an index value of 100.0.
Index values relative to the reference period are updated in each release to reflect revisions to underlying data. Index values commencing week ending 4 January 2020 are available via Table 4 in the Data downloads section to support users to undertake additional longer time series analysis.
The indexes allow comparison between two points in time. The points in time can be adjacent (this week and the previous week) or many weeks apart. Movements in the index from one period to another can be expressed as either points or percentage change and these are rounded to one decimal place.
The following example illustrates the method of calculating changes in index points and percentage changes between any two periods:
Total employee wages - Australia index numbers
| Index number | |
|---|---|
| Week ending 4 April 2020 | 93.3 |
| Less week ending 21 March 2020 | 99.5 |
| Change in index points | -6.2 |
| Percentage change | -6.2/99.5 X 100 = -6.2% |
These indexes differ from the ABS' suite of price indexes, including the Wage Price Index, which measure changes in price over time unaffected by quality or quantity and should not be directly compared.
Concept of an employee job
An employee job is a relationship between an employed person and their employing enterprise, where the employee has received a payment in the reference week through STP-enabled software and reported to the ATO.
Limitations
STP data does not include information on hours worked or hours paid for. Analysis of monthly hours worked can be found in Labour Force, Australia (cat. no. 6202.0) and the detailed releases (cat. no. 6291.0.55.001 and 6291.0.55.003).
The estimates do not include information on the employment status of employees, i.e. full time or part time. This will be explored as part of ongoing work between the ABS and the ATO. In the interim, this information is also available within the suite of Labour Force releases.
Note: The gender statistics contain a component of unspecified which have been excluded from the sex calculations but are included in all other calculations.
Privacy and confidentiality
STP data is supplied by the ATO to the ABS under the Taxation Administration Act 1953, which requires that such data is only used for the purposes of administering the Census and Statistics Act 1905. Any discussion of data limitations or weaknesses is made within the context of using the data for statistical purposes, and is not related to the ability of the data to support the ATO's core operational requirements.
Legislative requirements to ensure privacy and secrecy of this data have been adhered to. In accordance with the Census and Statistics Act 1905, results have been confidentialised to ensure that they are not likely to enable identification of a particular person or organisation.
Acknowledgement
The ABS would like to acknowledge the critical support from the Australian Taxation Office (ATO) in enabling the ABS to produce these statistics.