Overseas Arrivals running at 8% growth. QLD suffering as others states surge.

The release from the ABS of the Overseas Arrivals and Departures data for Nov shows short-term arrivals into Australia rose 8% for the year. Visitors from China continue to grow strongly; up 7.8% (seasonally adjusted) and up 13.7% (Trend). Short-term departures of residents (which are only provided on an original, unadjusted basis) are up 6% y/y.

Such impressive increases in international visitors should translate into healthy numbers for those states attracting the international tourists, and yet data suggests that Queensland has been doing poorly in this regard. As we have been highlighting for some time, Queensland performance in the international visitor market has been poor recently (see here). The International Visitor Survey (IVS) from Tourism Research Australia is only produced quarterly with the most recent, covering the Sept quarter, released just a few weeks ago. Nevertheless this monthly Arrivals and Departures data from the ABS does provide original, unadjusted numbers for the state of intended stay of short-term visitors and, when used correctly, this data can tell us something about what we might expect from the Dec IVS when we get hold of it in March.

By Trending the original ABS data we can see that the worrying trend in the performance of Queensland has continued beyond the most recent IVS data. In the two months since the Sept quarter this data would suggest that visitor numbers to Queensland have fallen 0.8% (while they are up 0.6% across the nation as a whole) and are down 4.8% from their highs in April 2017.

It is important to note that this is a very different data set to the IVS from Tourism Research Australia (which has reported international visitor numbers to QLD growing, albeit at a much slower rate than at a national level) so we would not suggest that this analysis suggests international visitor numbers in QLD are about to contract, but it does demonstrate the relatively poor recent performance of the state.

How long does it take to get a job in QLD?

I was spurred into action this week by an article from John McCarthy in the Courier Mail  (see here) in which he discussed the ABS data for the median length of time job seekers are spending looking for work. It’s not a data set that I’ve previously looked at much but John’s article got me to take a closer look.

The first thing that became clear was that the ABS data is presented on a monthly, unadjusted original basis and, as such, is extremely volatile. Comparing one month’s worth of data really doesn’t make much sense in this scenario. In order to try and get a better, clearer picture I spent some time seasonally adjusting the data at the state and territory level and at the SA4 regional level in QLD and have created the Conus Trend Search for Job series. The results are quite interesting.

Firstly it’s clear that since the impacts of the GFC took hold in 2008-09 we’ve seen a steady increase in the median number of weeks that people are out of work. However, in more recent times (since mid-2017) the nation as a whole, and NSW and Victoria in particular, have seen a sharp and significant reduction. Queensland, on the other hand, despite witnessing country-leading jobs growth in 2017, has seen a sharp move up in the length of time taken to find work. In his article John suggests that this might have something to do with the pick-up in interstate migration that we’ve seen into Queensland during 2017.

When we look at Queensland more closely we see the move up has been replicated across both the capital and the regions; although the scale of the increase has been far more dramatic in Greater Brisbane. This could be seen as further evidence of the impact of inter-state migration as more of these migrants are likely to settle in the Greater Brisbane area (at least initially) than the regions. Within the regions it would certainly appear that the closer to Brisbane one is the shorter the wait with Darling Downs – Maranoa (10 weeks), Gold Coast (11 weeks) and Sunshine Coast (16 weeks) the best performers.

In our own region we see a similar pattern of increases since the GFC, although search duration has declined over the past year as the local labour market has improved. Mackay, a region that the Courier Mail article highlighted, has also seen sharp falls during 2017 which tallies with the Conus Trend Jobs data showing the region’s employment growth at 6% for the year to November. This graph also includes the original, unadjusted ABS data just so that readers can see quite how volatile this data set is!

Time for ABS to step up with better data for the regions

For years we have been bemoaning the lack of quality data provided by the ABS at a regional (SA4) level. In particular the labour market data has been a major gripe of ours. How can we expect State and Local Governments to be making sensible policy decisions when they are fed sub-standard data on which to base those decisions?

At a State and National level the ABS provide Labour Force data on a seasonally adjusted (often taken as the “headline” number) and Trend basis. The ABS are very clear in their message that the Trend series, although not as headline grabbing as the seasonally adjusted, is the preferred measure. We agree.

However, when it comes to the regional data the Labour Force data is presented in its raw, unadjusted, original state. The ABS caution against using the monthly original data (as they should) and instead point users to the 12 month averages (which they also now helpfully provide for those unable to add up and divide by 12). These annual averages are taken as the “official” data for the regions and they are used by the Queensland Government Statistician’s Office, among others, in their regional labour market briefings. The problem here is that these annual averages are all but useless as an indicator about what is actually happening now, or at least in the recent past. Certainly no one would suggest that the annual average data was “good enough” at a State or National level; and certainly no one would accept it if that was presented as the basis for decision making.

The latest ABS Labour Force data for June gives us a good idea of the scale of the problem.

Consider the question “what is happening to employment in Queensland at the moment?”

To answer that question any sensible soul would head straight to the ABS Trend data for June and there they would discover that Trend employment in Queensland sits at 2,391,400 and has risen by 43,300 over the past year.

But if we wished to dig a little deeper and see where those gains were then we’re in trouble.

A look at the ABS annual average data for June tells us that Greater Brisbane has 1,182,900 people employed; a number which is up by 3,500 in the year. The Rest of Queensland employs 1,177,400 and has seen employment fall by 3,600 in the 12 months. How can this be right? Employment at only 2,360,300 (31,100 lower than the Trend) and having fallen by 100 over the year!?

This is why we created the Conus Trend and, despite some reasonable concerns about volatility in the underlying data, we are convinced that it is a major step towards a better understanding of regional labour forces. The Conus Trend for June shows employment in Greater Brisbane at 1,192,700 having risen 11,700 over the year. The Rest of Queensland stands at 1,198,800 and is up 31,700 for the year. That is a very different story to the “official” one told by the ABS annual average but is consistent with the ABS Trend data for Queensland.

At a regional level the differences can also be stark.

  • In Cairns the annual average has employment up 6,300 for the year and the unemployment rate at 6.3%. The Conus Trend is much stronger with employment growth of 12,700 and an unemployment rate of 5.3%.
  • A similar story emerges in Townsville where the “official” unemployment rate is 9.7% while we estimate it at 7.5%.
  • And it’s not all one way; in Fitzroy the annual average shows a loss of 1,500 jobs for the year while the Trend estimates it as a 8,900 fall.

The point, I hope, is clear. The “official” annual average data is in no way reflective of the reality on the ground and therefore cannot be a sensible basis for decision making.

I understand that the ABS has limited resources and feels unable to complete the work required at a SA4 level to provide a series they are happy with. I can appreciate that problem (although at Conus we too have only limited resources and yet have managed to do the work for QLD, NSW and Victoria!…see the full data sets here), but what about taking a preliminary step and providing ABS Trend data at the “Capital and Rest of State” level? Such a move would indicate a genuine commitment from the ABS to the provision of better regional data (and therefore decision making) and provide State and Local governments with a far better idea about what is going on in their Labour Markets.

We’re encouraged that many more people are now using the Conus Trend data that we make available but frankly would prefer to see the ABS step into the breech, even if only in a limited way, and help out the regions.

NSW and Victoria added to the Conus Trend Regional Jobs database

For some time we have been working to expand our Conus Trend Regional Jobs database and are pleased to announce that we now have our full Conus Trend data available for NSW and Victoria to add to our previous QLD data.

Following future ABS Regional Labour Force data releases we will be working to get the QLD data set prepared and available first and then the NSW and Victoria in the days after the release. All three sets of data will be available for download for non-commercial use on our Reports page, and we would ask that you acknowledge Conus when you utilise this data. The latest data for NSW and Victoria (relating to the Sept 2016 data) are both also available for download below.

Conus Trend NSW Regional Jobs – Sept 2016

Conus Trend VIC Regional Jobs – Sept 2016