RDP 9801: Labour Market Adjustment: Evidence on Interstate Labour Mobility Appendix C: Data Sources

Guy Debelle and James Vickery

February 1998

Employment, unemployment and population by state

Source: Labour Force, Australia, ABS Cat. No. 6203.0, Table 8.

Willingness to migrate survey results

Source: Australians' Employment and Unemployment Patterns 1994–96, ABS Cat. No. 6286.0, unit record data.

Gross migration and net migration

Source: Migration, Australia, ABS Cat. No. 3412.0, Table 4.

Real wages by state

Source: Average Weekly Earnings, Australia, ABS Cat. No. 6302.0, Table 12.

We use average weekly earnings by state as a measure of wages,[18] both in nominal terms and deflated by state CPIs. The empirical results were generally invariant to this distinction, because state CPIs move closely together over time.

Footnote

The task of finding a reasonable measure of wage relativities between states is made more difficult because differences in average earnings between states reflect compositional differences in the employment mix as well as wage relativities. A state such as Western Australia, with a higher proportion of workers in the resources and mining sector, would have higher average weekly earnings for that reason. However, given imperfect substitution between employment in different industries, a wage differential caused by compositional differences would not induce migration flows. The model can accommodate a constant ‘wedge’ in average weekly earnings between two states through the state-specific constant term; however, average weekly earnings is a less than satisfactory measure in the case where relative workforce composition between states changes over time. [18]