National economic indicators series

National Economic Indicators Series
Data notes

Gross Regional Product

Reliable primary economic data sets exist only at the national, state and regional level at best. Therefore the only way to get a realistic measure of GRP, number of jobs and worker productivity at the local area level is to undertake economic modelling. The most significant challenge with local area economic modelling is to ensure that the process reflects the unique economic characteristics of the local area. For example, one of the traps is to apply national and state-level productivity propensities at the local level, which we now know are simply not accurate because it assumes that the economic characteristics of all local areas are the same.

NIEIR are recognised as industry leaders in the development and provision of robust economic modelling at the smallest credible geographic unit (Local Government Area).

NIEIR modelling draws on many data sources to offer the most nuanced data possible at the local level. The NIEIR dataset is the result of a process of economic micro-simulation modelling – it is an amalgam of many different existing data sources (between 6 and 10 depending on the region and time period) which are synthesised to produce a series of estimates of the size and value of the local economy.

Importantly, the NIEIR model is updated on an annual basis (with quarterly breakdown for some characteristics). This means the impact of global, national and local economic changes can be clearly seen at the local level.

We established that this modelling was superior to any other models we evaluated for the following reasons:

  • Uses micro-simulation modelling (bringing together multiple data sources to simulate a realistic view of the local economy) Modelled annually ensuring the model is regularly updated to reflect global, national and local factors.
  • Does not rely purely on Census counts of employment (Census data is a fantastic resource but is known to undercount employment by 20% because it excludes anyone who does not state their workplace address).
  • Uses Centrelink, Department of Employment (formerly DEEWR) labour market statistics, ATO data to provide a more accurate estimate of CURRENT employment.
  • Estimates Hours Worked and converts this into a measure of Full-Time Equivalent Employment to ensure that underemployment cannot be hidden.
  • Does not assume that the productivity of an industry sector is the same across all LGAs in the State, but uses ATO data to ensure local differences are taken into account.
  • Uses locally derived inputs such as commercial building approvals by floor space, and Dun and Bradstreet datasets on business start-ups and exits to capture local industrial growth and decline.
  • Makes manual adjustments are made to refine the model based on local knowledge such as arrival of new employers, closing industries, large building construction etc (clients can input into this process)
  • Mining areas are treated differently to take into account fly-in-fly-out and other considerations.

Please contact .id for a detailed paper on the NIEIR model.

Data source: National Institute of Economic and Industry Research (NIEIR)©, 2014/15.

Next update: Data for the financial year 2015/16 will be available in April 2017.

Local jobs

Employment data presented here are estimates based on NIEIR modelling from a number of sources. They are NOT Census figures which typically undercount employment by approximately 20%. The NIEIR estimates should be a more accurate and up-to-date estimate of employment in an LGA than Census figures, because they adjust for:

  • Persons who reported no fixed place of work, and;
  • Persons who failed to report a place of work with codeable address.

Estimates of employment by industry from ATO income tax returns are used by postcode of residence and are converted to LGA of residence. Tax data is used because it is more timely and accurate than Census income data.

The Census undercount listed above is identified and allocated to workplace locations in accordance with the distribution for similar industry types of residents of the LGA who nominated a workplace. The results are then adjusted on a quarterly basis by employment results in the ABS Labour Force Survey. Estimates are also checked against commercial and industrial floorspace completion rates by location and industry in intercensal years.

Please note that these modelled estimates are subject to change. Estimates are reviewed when more recent and robust data becomes available, particularly when new National or State Accounts data are released by the ABS, or new tax office income data are released. Most recent financial year estimates are based on a combination of factors including Centrelink and Labour Force Survey data, which is replaced by ATO income data when it becomes available. As a result of this, revisions to the most recent 6 quarters (18 months) of data should be anticipated by users, which could change the statistical outcomes.

Data source: National Institute of Economic and Industry Research (NIEIR)©, 2014/15.

Next update: Data for the financial year 2015/16 will be available in April 2017.

Worker productivity

Worker productivity is calculated by dividing GRP by local jobs over the financial year. Regional differences in the worker productivity are inherent in the model, which is based on income tax return information from the ATO, relativities between industries calculated from Census data, and labour force survey information updated annually.

Please note that these modelled estimates are subject to change. Estimates are reviewed when more recent and robust data becomes available, particularly when new National or State Accounts data are released by the ABS, or new tax office income data are released. Most recent financial year estimates are based on a combination of factors including Centrelink and Labour Force Survey data, which is replaced by ATO income data when it becomes available. As a result of this, revisions to the most recent 6 quarters (18 months) of data should be anticipated by users, which could change the statistical outcomes.

Data source: National Institute of Economic and Industry Research (NIEIR)©, 2014/15.

Next update: Data for the financial year 2015/16 will be available in April 2017.

Unemployment rate

Local unemployment data are sourced from Small Area Labour Markets, a quarterly publication by the Department of Employment (federal government). This dataset uses the labour force survey as a base, and models it to local level using Centrelink data. All labour force data are subject to sampling error, as they are derived from a sample survey of approximately 29,000 dwellings nationwide.

All labour force data relates to the civilian population aged 15 years and over.

The definition of unemployment used is the standard ABS and international definition - Unemployed persons are defined as all persons aged 15 years and over who were not employed during the reference week, and either had actively looked for full-time or part-time work at any time in the four weeks up to the end of the reference week and were available for work in the reference week, or were waiting to start a new job within four weeks from the end of the reference week and could have started in the reference week if the job had been available then.

Data source: Department of Employment, Small Area Labour Markets, December Quarter 2015..

Next update: This series is a quarterly publication by the Department of Employment and Workplace Relations. Q4 year figures are quoted in this series to maintain comparisons with other annual indicators. Unemployment rates for Q4 2016 financial year will be available in April 2017.

Number of businesses

The ABS Business Register is extracted from the Australian Business Register maintained by the ATO. It is a count of businesses with an Australian Business Number (ABN) on the Australian Business Register that are actively registered for GST (i.e. actively trading).

The ABS Business Register does not include:

  • Entities without an ABN - mainly individuals whose business activities fall under the threshold for GST compliance and whose taxation obligations can be satisfied under the Personal Income Tax System
  • ABNs without a GST role – mainly businesses with turnover <$50,000pa, not-for-profit institutions with turnover of <$100,000 or entities whose activities do not involve trading in goods or services (eg investment vehicles)
  • Businesses that have ceased trading - no longer actively remitting GST obligations
  • Establishment of new locations associated with an existing business
  • Entities not considered to be actively trading in the market sector, including:
    • Central Bank
    • General Government – this particularly affects data for Education and Health and Community Services and means that institutions such as public universities, public schools, public hospitals and other public education and health organisations are not included in this data.
  • Non-Profit Institutions Serving Households
  • Charitable Institution
  • Social and Sporting Clubs
  • Trade Unions and Other Associations
  • Other Unincorporated Entity
  • Diplomatic or Trade Missions, Other Foreign Government
  • Private Households Employing Staff

The ABS Business Register does include:

  • Employing and non-employing businesses
  • Single location and multiple location businesses
  • Entities with complex business structure - the business is assessed and broken up into Type of Activity Units (TAUs). The statistical unit referred to as a "business" thus consists of ABNs and TAUs

Detailed information about this data set, including summary findings from the national dataset by industry sector, can be found at this location on the ABS website.

Please note that the ABS publish Business Register data for Statistical Area Level 2 districts. These do not necessarily add up to Local Government boundaries, so where the boundaries do not align, the data have been apportioned to LGAs based on estimated area of commercial and industrial land use.

Data source: Australian Bureau of Statistics, Counts of Australian Businesses, including entries and exits, June 2011 to June 2015.

Next update: The ABS release new Business Register information approximately on an annual basis, approximately one year after the reference period.

Estimated Resident Population

Populations are counted and estimated in various ways. The most comprehensive population count available in Australia is derived from the Population and Household Census conducted by the Australian Bureau of Statistics every 5 years.

However the Census count is not the official population of an area. To provide a more accurate population figure which is updated more frequently than every 5 years, the Australian Bureau of Statistics also produces "Estimated Resident Population" (ERP) numbers. Based on population estimates as at 30 June, ERPs take into account people who missed the count on Census night, including people who were temporarily overseas, plus an undercount adjustment for those who did not complete a Census form, and an overcount adjustment for anyone who was double counted.

Estimated Resident Population figures are updated annually taking into account births, deaths, internal and overseas migration. In addition, after every Census, ERP figures for the five previous years are "backcast", using information from the current Census, to ensure the most accurate figures are available.

See the ABS demographic publications, 3101.0 and 3218.0 for further details.

Data source: Australian Bureau of Statistics, Regional Population Growth, Australia, 2013/14.

Next update: The revised ERP for the year ending June 2015 will be available at April 2015.

Value of Building Approvals

The value of approval data includes all approved residential building valued at $10,000 or more and all approved non-residential building valued at $50,000 or more. Value of building work excludes the value of land, and also excludes landscaping, but includes site preparation costs. Both new dwellings and alterations and additions to existing dwellings are included in the residential approvals.

Data source: Australian Bureau of Statistics, Catalogue number 8731.0 – Building Approvals, Australia.

Next update: While this is a monthly publication, the data here are presented annually for financial years to maintain comparisons with other annual indicators. The value of building approvals for the 2015/16 financial year will be available in April 2017.