An Australian Labour Market Conditions Index

Angelia Grant, Wilma Gillies, Ray Harris and Melissa Ljubic
Additional contact information
Wilma Gillies: Treasury, Government of Australia
Ray Harris: Treasury, Government of Australia
Melissa Ljubic: Treasury, Government of Australia

No 2016-04, Treasury Working Papers from The Treasury, Australian Government

Abstract: This paper constructs a labour market conditions index for Australia using principal components analysis with 16 labour market variables. The index is broadly consistent with the business cycle in Australia. It shows that there was a large amount of slack in the Australian labour market during the global financial crisis and it has only recently returned to around average conditions. The index explains between 64 and 87 per cent of the variation in half of the labour market variables used in the analysis. The correlation between wage growth and the labour market conditions index is stronger than the correlation with the unemployment rate alone. In addition, the labour market conditions index appears to be a strong leading indicator of wage growth. The index is not sensitive to the addition of other variables.

Keywords: NA (search for similar items in EconPapers)
Pages: 19 pages
Date: 2016-12, Revised 2016-12
References: Add references at CitEc
Citations:

Downloads: (external link)
http://treasury.gov.au/~/media/Treasury/Publicatio ... rket_Cond_Index.ashx First version, 2016 (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://treasury.gov.au/~/media/Treasury/Publications%20and%20Media/Publications/2016/An%20Australian%20Labour%20Market%20Conditions%20Index/Downloads/PDF/Aust_Labour_Market_Cond_Index.ashx [301 Moved Permanently]--> https://treasury.gov.au/~/media/Treasury/Publications%20and%20Media/Publications/2016/An%20Australian%20Labour%20Market%20Conditions%20Index/Downloads/PDF/Aust_Labour_Market_Cond_Index.ashx)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:tsy:wpaper:wpaper_tsy_wp_2016_4

Access Statistics for this paper

More papers in Treasury Working Papers from The Treasury, Australian Government Contact information at EDIRC.
Bibliographic data for series maintained by The Treasury (Commonwealth of Australia) ().