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EXPLANATORY NOTES


INTRODUCTION

1 This publication contains quarterly estimates of job vacancies based on information obtained from a sample survey of employers.

CONCEPTS, SOURCES AND METHODS

2 Descriptions of the underlying concepts of Australia's job vacancies statistics, and the sources and methods used in compiling these estimates, are presented in Labour Statistics: Concepts, Sources and Methods (cat. no. 6102.0.55.001).

SCOPE AND COVERAGE

3 All job vacancies (as defined in the Glossary) for wage and salary earners are represented in the Job Vacancies Survey (JVS), except those:

• in the Australian permanent defence forces
• in businesses primarily engaged in agriculture, forestry and fishing
• in private households employing staff
• in overseas embassies, consulates, etc.
• located outside Australia.

• new businesses
• businesses which have ceased employing
• changes in employment levels
• changes in industry
• other general business changes.

6 Businesses which have ceased employing are identified when the ATO cancels their PAYGW registration. In addition, businesses which did not remit under the PAYGW scheme for the previous five quarters are removed from the frame.

SURVEY METHODOLOGY AND DESIGN

7 A sample of approximately 5,000 employers is selected from the ABS Business Register to ensure adequate state and industry representation. The sample is updated each quarter to reflect changes in the ABS Business Register. These changes arise from the emergence of new businesses, takeovers and mergers, changes to industry classification, changes in the number of employees, and businesses which have ceased operations. Such updating of the register can contribute to changes in the estimates of job vacancies.

8 The statistical unit for the survey comprises all the activities of an employer in a particular state or territory based on the Australian Business Number (ABN) unit or Type of Activity Unit (TAU) (see paragraphs 11 and 15 of the Explanatory Notes). Each statistical unit is classified to an industry which reflects the predominant activity of the business. The statistical units are stratified by state, industry division and employment size, and within each stratum, statistical units are selected with equal probability.

STATISTICAL UNITS DEFINED ON THE ABS BUSINESS REGISTER

9 The ABS uses an economic statistics units model on the ABS Business Register to describe the characteristics of businesses, and the structural relationships between related businesses. The units model is also used to break groups of related businesses into relatively homogeneous components that can provide data to the ABS.

10 In mid-2002, to better use the information available as a result of The New Tax System, the ABS changed its economic statistics units model. The new units model allocates businesses to one of two sub-populations. The vast majority of businesses are in what is called the ATO Maintained Population, while the remaining businesses are in the ABS Maintained Population. Together, these two sub-populations make up the ABS Business Register population.

ATO maintained population

11 Most businesses and organisations in Australia need to obtain an Australian Business Number, and are then included on the ATO Australian Business Register. Most of these businesses have simple structures; therefore the unit registered for an ABN will satisfy ABS statistical requirements. For these businesses, the ABS has aligned its statistical units structure with the ABN unit. The businesses with simple structures constitute the ATO Maintained Population, and the ABN unit will be used as the economic statistics unit for all economic collections.

ABS maintained population

12 For the population of businesses where the ABN unit is not suitable for ABS statistical requirements, the ABS maintains its own units structure through direct contact with the business. These businesses constitute the ABS Maintained Population. This population consists typically of large, complex and diverse businesses. The new statistical units model described below has been introduced to cover such businesses.

13 Enterprise Group: This is a unit covering all the operations in Australia of one or more legal entities under common ownership and/or control. It covers all the operations in Australia of legal entities which are related in terms of the current Corporations Law (as amended by the Corporations Legislation Amendment Act 1991), including legal entities such as companies, trusts, and partnerships. Majority ownership is not required for control to be exercised.

14 Enterprise: The enterprise is an institutional unit comprising (i) a single legal entity or business entity, or (ii) more than one legal entity or business entity within the same Enterprise Group and in the same institutional subsector (i.e. they are all classified to a single Standard Institutional Sector Classification of Australia subsector).

15 Type of Activity Unit: The TAU comprises one or more business entities, sub-entities or branches of a business entity within an Enterprise Group that can report production and employment data for similar economic activities. When a minimum set of data items is available, a TAU is created which covers all the operations within an industry subdivision (and the TAU is classified to the relevant subdivision of the Australian and New Zealand Standard Industrial Classification [ANZSIC]). Where a business cannot supply adequate data for each industry, a TAU is formed which contains activity in more than one industry subdivision.

16 For more information on the impacts of the introduction of the new economic statistics units model, refer to Information Paper: Improvements in ABS Economic Statistics [Arising from The New Tax System] (cat. no. 1372.0).

COMPARABILITY OF SERIES

17 Job vacancies series in this publication were introduced with the November 1983 issue of the Job Vacancies and Overtime survey publication. Estimates contained in this publication are not strictly comparable with those obtained prior to November 1983.

18 Between August and November 1999 a number of improvements were made to operational procedures, in conjunction with the discontinuation of the overtime component of the survey. These improvements resulted in an increase in job vacancy estimates for the private sector. There was negligible change to public sector estimates. Consequently, private sector estimates prior to November 1999 were adjusted to provide a comparable and compatible time series.

19 To account for the New Tax System changes described in paragraphs 9 to 16, the historical series from May 2002 back to November 1983 have been revised to make the time series of estimates as continuous as possible.

20 From November 2003, number of employees is no longer collected in JVS. Consequently job vacancy rates (see Glossary) are no longer presented in this publication. Job vacancy rates can be derived based on estimates of the number of employees from the Labour Force Survey.

21 The privatisation of Telstra Corporation has impacted on the private sector and public sector job vacancies series. Telstra Corporation was effectively privatised on 20 November 2006. For the purposes of ABS statistics this change from public sector to private sector is effective from March quarter 2007. For more information please see Information Paper: Future Treatment of Telstra in ABS Statistics, 2007 (cat. no. 8102.0), released 26 February 2007.

22 Although the privatisation of Telstra Corporation has impacted on both private and public sector series, the effect is significant only for the public sector series. As a result, a trend break has been applied to the public sector series between November 2006 and February 2007. See paragraphs 23 to 31 for more information about seasonally adjusted and trend estimates.

SEASONAL ADJUSTMENT

23 Seasonal adjustment is a means of removing the estimated effects of normal seasonal variation from the series so that the effects of other influences can be more clearly recognised. Seasonal adjustment does not aim to remove the irregular or non-seasonal influences which may be present in any particular series. Influences that are volatile or unsystematic can still make it difficult to interpret the movement of the series even after adjustment for seasonal variation. This means that quarter-to-quarter movements of seasonally adjusted estimates may not be reliable indicators of trend behaviour.

24 JVS uses the concurrent seasonal adjustment method to derive seasonal factors. Concurrent seasonal adjustment uses data up to and including the current quarter to estimate seasonal factors for the current and all previous quarters. This process can result in revisions each quarter to estimates for earlier periods. However, in most instances, the only noticeable revisions will be to the seasonally adjusted estimates for the previous quarter and one year prior to the current quarter.

25 While seasonal factors for the complete time series are estimated each quarter, they are reviewed annually at a more detailed level to take into account each additional year's original data. The annual review is conducted on data up to and including August each year, with the results reflected in estimates released in the November issue of this publication. This annual review normally does not result in significant changes to previously published data.

26 Details about the method of seasonal adjustment of these series are available on request.

TREND ESTIMATES

27 Seasonally adjusted estimates can be smoothed to reduce the impact of irregular or non-seasonal influences. Smoothed seasonally adjusted series are called trend estimates.

28 The ABS considers that trend estimates provide a more reliable guide to the underlying direction of the data, and are more suitable than either the seasonally adjusted or original estimates for most business decisions and policy advice.

29 Trend estimates, obtained by dampening out the irregular component from the seasonally adjusted series, are calculated using a centred 7-term Henderson moving average of the seasonally adjusted series. Estimates for the three most recent quarters cannot be calculated using this centred average method; instead an asymmetric average is used. This can lead to revisions in the trend estimates for the last three quarters when data become available for later quarters. Revisions of trend estimates will also occur with revisions to the original data and re-estimation of seasonal adjustment factors.

30 If a series is highly volatile then the trend estimates will be subject to greater revision for the latest few quarters as new data become available. However, it is important to note that this does not make the trend series inferior to the seasonally adjusted or original series.

31 For more information, refer to Information Paper: A Guide to Interpreting Time Series - Monitoring Trends (cat. no. 1349.0), or alternatively contact the Assistant Director, Time Series Analysis on (02) 6252 6345 or email <time.series.analysis@abs.gov.au>.

EFFECTS OF ROUNDING

32 Where figures have been rounded, discrepancies may occur between sums of the component items and totals. Percentages in this publication are calculated using unrounded numbers and consequently could differ from percentages that are calculated from the published rounded statistics.

RELATED PUBLICATIONS

33 The following publications contain related information:

• Australian Labour Market Statistics (cat. no. 6105.0) - issued quarterly
• Average Weekly Earnings, Australia (cat. no. 6302.0) - issued quarterly
• Employee Earnings and Hours, Australia (cat. no. 6306.0) - issued biennially
• Information Paper: Future Treatment of Telstra in ABS Statistics, 2007 (cat. no. 8102.0) - issued 26 February 2007
• Information Paper: Improvements in ABS Economic Statistics [Arising from The New Tax System] (cat. no. 1372.0) - issued 6 May 2002
• Labour Force, Australia (cat. no. 6202.0) - issued monthly
• Labour Statistics: Concepts, Sources and Methods (cat. no. 6102.0.55.001)
• Wage and Salary Earners, Public Sector, Australia (cat. no. 6248.0.55.001) - issued quarterly.