How efficient is the Australian labour market? Analysing job matching efficiency for regions, occupations and industries

Peter Lake, Samuel Shamiri, Kishor Sharma () and Adam Bialowas
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Peter Lake: Jobs and Skills Australia
Samuel Shamiri: Jobs and Skills Australia
Kishor Sharma: Jobs and Skills Australia
Adam Bialowas: Jobs and Skills Australia

Australian Journal of Labour Economics (AJLE), 2024, vol. 27, issue 1, 101-117

Abstract: In an efficient labour market, employers fill vacancies in a timely manner, and those who are unemployed do not remain out of work for long. However, this is not always the case. During an economic downturn, workers who are laid off may possess different skills to those required in sectors that remain strong. As a result, the unemployed may remain unemployed for longer, because they are unable to find work. In addition, the remaining vacancies may go unfilled, as suitable workers cannot be obtained from the unemployment pool. In such circumstances, poor labour market efficiency is at play, and the economic and social costs can be substantial. Consequently, Jobs and Skills Australia (JSA) has been researching this topic by examining the question ‘for a given level of vacancies (demand) and unemployment (supply), how many hires should be occurring in the labour market?’. Using data from both JSA and the Australian Bureau of Statistics (ABS), experimental insights into labour market efficiency for regions and occupations have been derived, paving the way for further research that may provide opportunities to inform economic and labour market policies. Our results tend to suggest that efficiency of the labour market in matching unemployed persons with jobs is currently relatively high and has broadly improved in recent years.

Keywords: Labour supply, labour demand; occupational market, public policy (search for similar items in EconPapers)
JEL-codes: J22 J23 J38 J62 (search for similar items in EconPapers)
Date: 2024
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