IDEAS home Printed from https://ideas.repec.org/a/ozl/journl/v27y2024i1p101-117.html
   My bibliography  Save this article

How efficient is the Australian labour market? Analysing job matching efficiency for regions, occupations and industries

Author

Listed:
  • Peter Lake

    (Jobs and Skills Australia)

  • Samuel Shamiri

    (Jobs and Skills Australia)

  • Kishor Sharma

    (Jobs and Skills Australia)

  • Adam Bialowas

    (Jobs and Skills Australia)

Abstract

In an efficient labour market, employers fill vacancies in a timely manner, and those who are unemployed do not remain out of work for long. However, this is not always the case. During an economic downturn, workers who are laid off may possess different skills to those required in sectors that remain strong. As a result, the unemployed may remain unemployed for longer, because they are unable to find work. In addition, the remaining vacancies may go unfilled, as suitable workers cannot be obtained from the unemployment pool. In such circumstances, poor labour market efficiency is at play, and the economic and social costs can be substantial. Consequently, Jobs and Skills Australia (JSA) has been researching this topic by examining the question ‘for a given level of vacancies (demand) and unemployment (supply), how many hires should be occurring in the labour market?’. Using data from both JSA and the Australian Bureau of Statistics (ABS), experimental insights into labour market efficiency for regions and occupations have been derived, paving the way for further research that may provide opportunities to inform economic and labour market policies. Our results tend to suggest that efficiency of the labour market in matching unemployed persons with jobs is currently relatively high and has broadly improved in recent years.

Suggested Citation

  • Peter Lake & Samuel Shamiri & Kishor Sharma & Adam Bialowas, 2024. "How efficient is the Australian labour market? Analysing job matching efficiency for regions, occupations and industries," Australian Journal of Labour Economics (AJLE), Bankwest Curtin Economics Centre (BCEC), Curtin Business School, vol. 27(1), pages 101-117.
  • Handle: RePEc:ozl:journl:v:27:y:2024:i:1:p:101-117
    as

    Download full text from publisher

    File URL: https://ajle.org/index.php/ajle_home/article/view/217
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Christopher A. Pissarides & Barbara Petrongolo, 2001. "Looking into the Black Box: A Survey of the Matching Function," Journal of Economic Literature, American Economic Association, vol. 39(2), pages 390-431, June.
    2. Coelli, Tim J., 1995. "Recent Developments In Frontier Modelling And Efficiency Measurement," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 39(3), pages 1-27, December.
    3. René Fahr & Uwe Sunde, 2004. "Occupational job creation: patterns and implications," Oxford Economic Papers, Oxford University Press, vol. 56(3), pages 407-435, July.
    4. Warren, Ronald S, Jr, 1991. "The Estimation of Frictional Unemployment: A Stochastic Frontier Approach," The Review of Economics and Statistics, MIT Press, vol. 73(2), pages 373-377, May.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Rene Fahr & Uwe Sunde, 2006. "Regional dependencies in job creation: an efficiency analysis for Western Germany," Applied Economics, Taylor & Francis Journals, vol. 38(10), pages 1193-1206.
    2. Alexandra Fedorets & Franziska Lottmann & Michael Stops, 2019. "Job matching in connected regional and occupational labour markets," Regional Studies, Taylor & Francis Journals, vol. 53(8), pages 1085-1098, August.
    3. Brown, Alessio & Merkl, Christian & Snower, Dennis, 2015. "An Incentive Theory Of Matching," Macroeconomic Dynamics, Cambridge University Press, vol. 19(3), pages 643-668, April.
    4. Stops Michael & Mazzoni Thomas, 2010. "Matchingprozesse auf beruflichen Teilarbeitsmärkten / Job Matching on Occupational Labour Markets," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 230(3), pages 287-312, June.
    5. Kohlbrecher, Britta & Merkl, Christian & Nordmeier, Daniela, 2016. "Revisiting the matching function," Journal of Economic Dynamics and Control, Elsevier, vol. 69(C), pages 350-374.
    6. Baños, José F. & Rodríguez-Álvarez, Ana & Suárez, Patricia, 2016. "Matching frontiers: A random parameter model approach," Efficiency Series Papers 2016/07, University of Oviedo, Department of Economics, Oviedo Efficiency Group (OEG).
    7. Woong Lee, 2017. "Trade Liberalization and the Aggregate Matching Function in India," Asian Economic Papers, MIT Press, vol. 16(1), pages 120-137, Winter/Sp.
    8. Sergio Destefanis & Raquel Fonseca, 2006. "Labour-Market Reforms and the Beveridge Curve. Some Macro Evidence for Italy," CSEF Working Papers 168, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy.
    9. Aomar Ibourk & Bénédicte Maillard & Sergio Perelman & Henri Sneessens, 2004. "Aggregate Matching Efficiency: A Stochastic Production Frontier Approach, France 1990–1994," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 31(1), pages 1-25, March.
    10. Haller, Peter & Heuermann, Daniel F., 2016. "Job search and hiring in local labor markets: Spillovers in regional matching functions," Regional Science and Urban Economics, Elsevier, vol. 60(C), pages 125-138.
    11. Altavilla, Carlo & Caroleo, Floro Ernesto, 2009. "Unintended Effects of National-based Active Labour Market Policies," IZA Discussion Papers 4045, Institute of Labor Economics (IZA).
    12. Iva Tomić, 2014. "Regional matching (in)efficiency on the Croatian labour market," Acta Oeconomica, Akadémiai Kiadó, Hungary, vol. 64(3), pages 287-312, September.
    13. Fahr René & Sunde Uwe, 2009. "Did the Hartz Reforms Speed-Up the Matching Process? A Macro- Evaluation Using Empirical Matching Functions," German Economic Review, De Gruyter, vol. 10(3), pages 284-316, August.
    14. Goos, Maarten & Rademakers, Emilie & Salomons, Anna & Willekens, Bert, 2019. "Markets for jobs and their task overlap," Labour Economics, Elsevier, vol. 61(C).
    15. Michael Stops, 2016. "Revisiting German labour market reform effects—a panel data analysis for occupational labour markets," IZA Journal of European Labor Studies, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 5(1), pages 1-43, December.
    16. George Sheldon, 2003. "The Efficiency of Public Employment Services: A Nonparametric Matching Function Analysis for Switzerland," Journal of Productivity Analysis, Springer, vol. 20(1), pages 49-70, July.
    17. Sergio Destefanis & Raquel Fonseca, 2006. "Labour-Market Reforms and the Beveridge Curve. Some Macro Evidence for Italy," CSEF Working Papers 168, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy.
    18. Michael Stops, 2014. "Job matching across occupational labour markets," Oxford Economic Papers, Oxford University Press, vol. 66(4), pages 940-958.
    19. Ambra Poggi, 2019. "Regional labour markets in Spain: Can flexibility and local democracy reduce inefficiencies?," Papers in Regional Science, Wiley Blackwell, vol. 98(3), pages 1499-1516, June.
    20. Poeschel, Friedrich, 2012. "The time trend in the matching function," IAB-Discussion Paper 201203, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].

    More about this item

    Keywords

    Labour supply; labour demand; occupational market; public policy;
    All these keywords.

    JEL classification:

    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ozl:journl:v:27:y:2024:i:1:p:101-117. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sandie Rawnsley (email available below). General contact details of provider: https://edirc.repec.org/data/becurau.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.