The September quarter 2022 Small Area Labour Markets (SALM) estimates are now available. SALM presents estimates of unemployment and the unemployment rate at the Statistical Area Level 2 (SA2) and Local Government Area (LGA) levels.
The latest results show there has been a significant increase in the number of SA2s with an unemployment rate of less than 5% over the past year (from 1,145 to 1,621). The number of SA2s with an unemployment rate of 10% or higher has fallen considerably (from 200 to 95). These results reflect the strong recovery in labour market conditions that has occurred since the end of the 2021 COVID-19 related lockdowns.
The data also show that around 9 in 10 SA2s (or 92.6%) recorded a decrease in their unemployment rate over the year to the September quarter 2022, the largest proportion recorded since the start of the series. SA2s located in capital cities were more likely to record a fall in their unemployment rate over the year than those outside capital cities (97.2% compared with 86.4%).
When comparing SALM data over the year, it is important to note that the September quarter 2021 smoothed figures (an average of the 12 months to the last month of the quarter) include part of the period of softer labour market conditions that occurred after Australia’s initial lockdown during the first wave of COVID-19. While both the September quarter 2021 and September quarter 2022 were affected by the COVID-19 outbreaks in south-eastern Australia in the second half of 2021, the negative impact of these lockdowns on the labour market was neither as severe nor as widespread as that associated with the initial wave of COVID-19.
JSA recommends that SALM users review the ‘smoothed’ SALM data which are created by applying a four-quarter average to ‘unsmoothed’ SALM data. While the smoothed data will lag actual changes in labour market conditions, it also reduces the high level of statistical variability inherent in small area estimates which may be exacerbated during the COVID-19 pandemic.