Glossary

Employed: The ABS classifies people as employed if they were in a paid job (or worked without pay in a family business or farm) for one hour or more in a week.

Fiscal stimulus: a decision taken by the government to increase economic growth. This is usually by increasing government spending (examples include giving taxpayers a cash payment to spend or funding infrastructure projects like new roads) or through reducing taxes to encourage people to spend more.

Full-time employment: The ABS classifies people as employed full-time if they typically work 35 or more hours a week.

Labour force: The sum of employed and unemployed people. Those not in the labour force includes people who are not employed and who are not looking for work (for example, people who are studying, caring for children or family members on a voluntary basis, retired, or who are permanently unable to work).

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Picture. Employed + Unemployed = Labour force.

 

Labour market: Essentially, this is the “jobs” market. It is the amount of people willing and able to work, and the demand from employers to fill their advertised vacancies. Potential employees compete to get the most satisfying job, while employers compete to attract the best candidates.

Participation rate: The percentage of people aged 15 years and over who are in the labour force (either employed or unemployed). A participation rate of 66%, for example, would mean around two-thirds of the population is either in work or is looking for work. People who are not employed and not looking for a job (such as full-time students, stay at home parents and retirees) are not considered to be participating in the labour market.

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Picture. Participation rate = Labour force divided by population (15+ years) times 100.

 

Part-time employment: The ABS classifies people as employed part-time if they typically work less than 35 hours per week.

People leaving the labour force: People may leave the labour force for many reasons, including enrolling in full-time study, caring for a family, ill health, or retiring.

Recession: A recession is is two quarters of consecutive negative GDP growth, typically resulting in job losses and an increase in the unemployment rate. Past recessions include the Great Depression of 1929-39 and the early 1990s recession in Australia.

Seasonally adjusted data: Data which has had seasonal effects removed to allow a more reliable interpretation of the strength of the labour market. An example of these seasonal effects would be the large scale hiring that occurs in the lead up to Christmas. If these seasonal effects are not removed, they can conceal the true story of what is happening with the data.

Trough: In economic terms, this refers to a stage in the business cycle where activity is bottoming, or where prices are bottoming, before a rise. The low point.

Unemployed: People who are not employed, but are actively looking for work.

Unemployment rate: The unemployment rate is the percentage of people in the labour force who are unemployed. When the economy is performing poorly and jobs are scarce, the unemployment rate is expected to rise. When the economy is growing at a healthy rate and jobs are readily available, it can be expected to fall.

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Picture. Unemployment rate = unemployed divided by labour force times 100.