Notes on the data: Labour force

Unemployment, June 2016


Policy context:  Those people who do not have access to secure and satisfying work are less likely to have an adequate income; and unemployment and underemployment are generally associated with reduced life opportunities and poorer health and wellbeing. Although the relationship between unemployment and health is complex and varies for different population groups, there is consistent evidence from research that unemployment is associated with adverse health outcomes; and unemployment has a direct effect on physical and mental health over and above the effects of socioeconomic status, poverty, risk factors, or prior ill-health [1] [2].

Readers should note that the official measure of unemployment, which this indicator is designed to emulate, does not take account of hidden unemployment (measured by the labour force participation rate) or underemployment (resulting from the loss of full-time jobs and the creation of part-time jobs). Alternative labour force indicators, which address these deficiencies, suggest the real level of unemployment in Australia is in excess of twice the official rate, with wider variations at a regional level [3].


  1. Mathers CD, Schofield DJ. The health consequences of unemployment: the evidence. Med J Aust. 1998;168(4):178-82.
  2. Dollard MF, Winefield AH. Mental health: overemployment, underemployment, unemployment and healthy jobs. Aust e-J Adv Mental Hlth. 2002:1(3).
  3. Barrett S, Nukic S, Treuren G. Beyond the unemployment rate: a reinterpretation of the Australian labour market [Internet]. In: Wrightson G (ed.), Creating a culture of full employment: incorporating the 7th Path to Full Employment Conference and 12th National Conference on Unemployment. Callaghan, NSW: University of Newcastle, Centre of Full Employment and Equity; 2005.

Notes:  These estimates, from the Small Area Labour Markets - Australia data series, are based on the Structure Preserving Estimation (SPREE) methodology which enables the generation of small area unemployment, unemployment rate and labour force estimates. They differ from the figures for people receiving an unemployment benefit as different rules are applied to eligibility for a welfare payment and being considered as unemployed. The estimates presented are derived from three primary data sources:

  1. Centrelink data for people in receipt of Newstart Allowance or Youth Allowance (other) [1] by Statistical Area Level 2 (SA2);
  2. Australian Bureau of Statistics (ABS) Labour Force Survey data by Statistical Area Level 4; and
  3. 2011 Census of Population and Housing participation rate data at the SA2 level.

The purpose of SPREE is to produce small area labour market estimates that reflect the regional disparities of the Centrelink data, while being consistent with the ABS Labour Force Survey estimates [2].

The unemployment estimates presented are based on the 'smoothed' data series, where the data have been averaged over four quarters to minimise the variability inherent in small area estimates.

Additional note/ Reference

  1. Youth Allowance (other) is largely comprised of unemployed people aged 16 to 21 looking for full-time work or undertaking approved activities, such as part-time study or training. This excludes Youth Allowance recipients who are full-time students or undertaking an apprenticeship/ traineeship.
  2. Labour Market Research and Analysis Branch/ Labour Market Strategy Group. Small area labour markets. Australia - September Quarter 2014. Canberra: Australian Government Department of Employment; 2014 [cited 2015 Mar 11]. Available from:

Numerator:  Unemployed people aged 15 years and over


Denominator:  People in the labour force aged 15 years and over


Detail of analysis:  Percent


Source:  Compiled by PHIDU based on Small Area Labour Markets - Australia, Department of Employment, June Quarter 2016.


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