Author: G.A. Meagher
This paper presents a detailed assessment of the medium term outlook for the demand
for labour in Australia. Forecasts are reported for employment by industry, by
occupation, by State and Territory, by hours worked and by skill level. The forecasts are
driven, in the first instance, by a fully articulated view about the outlook for the
macroeconomy. This macro view is then combined with projections for various industry
specific variables prepared by relevant expert organisations. Coherence between the
different sources is ensured by incorporating them in a single simulation using the
MONASH model, a large applied general equilibrium model of the Australian economy. In
deriving the forecasts, attention has been paid to the effect of technological and social
change on the structure of the economy in recent years , and to the implications of that
change for future labour demand. The paper deals particularly with technical change which
affects the distribution of employment across occupations within industries, and the
distribution across different categories of hours worked within occupations. Tables are
included to illustrate how the forecasting system can be interrogated to reveal
* the contributions of various industries to employment growth for a selected occupation,
and
* the relative importance of output growth, capital growth and labour saving technical
change to industry employment growth. The paper concludes with a review of some issues
associated with making a proper assessment of the forecasts.
JEL Classification: C68, D58, E47, J21.
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