14 Appendix A: New Zealand Standard Classification of Occupations (NZSCO)

A skills-based classification system

The New Zealand Standard Classification of Occupations (NZSCO) is a skills-based, hierarchical classification system that categorises the type of work that is performed in a job. Occupational groupings are differentiated from each other according to the responsibilities, tasks, training required, and experience common to that group.

Skills in the NZSCO are defined according to 'skill level' and 'skill specialisation'. These two definitions are used to classify occupations within the NZSCO structure. Occupations are assigned to the highest level, known as 'major groups', based on their required skill level. Occupations are assigned to lower levels, known as 'sub-major' and 'minor groups', based on progressively finer interpretations of skill specialisation.

Skill level reflects the complexity and range of tasks involved. Skill specialisation reflects the field of knowledge required to perform the tasks, the tools and equipment used, the materials worked with, and goods and services produced. Skill specialisation allows the major groups to be subdivided into sub-major groups, minor groups, and unit groups.

Using the five-level hierarchical structure

The NZSCO uses a five-level hierarchical structure of classification. At the highest level there are nine major groups. Major groups are loosely organised from highly skilled (major group 1) to less skilled (major group 9). Each major group can be further subdivided into four other levels (see appendix table 1):

• sub-major group
• minor group
• unit group
• occupation.

The more digits a classification level has, the more detailed the occupational group is. Occupations are most detailed at the 5-digit level.

Appendix table 1: NZSCO classification structure

Major groups	Sub-major groups	Minor groups	Unit groups	Occupations
Total	25	99	260	565
1 Legislators, administrators, and managers	2	6	14	34
2 Professionals	4	17	46	99
3 Technicians and associate professionals	3	16	54	119
4 Clerks	2	6	18	34
5 Service and sales workers	2	8	17	36
6 Agriculture and fishery workers	1	4	14	35
7 Trades workers	4	14	31	64
8 Plant and machine operators and assemblers	4	20	58	127
9 Elementary occupations	3	8	8	17

The example in Appendix table 2 below shows the five-level hierarchical structure for 'primary school teacher'.

Appendix table 2: Five-level hierarchical structure for 'primary school teacher'

Group	Level	Code	Description
Major group	1	2	Professional
Sub-major group	2	23	Teaching professionals
Minor group	3	232	Primary and early childhood teaching professionals
Unit group	4	2331	Primary teaching professionals
Occupation	5	23311	Primary school teacher

Appendix B: Methodology for the SERA

The Survey of Employers who have Recently Advertised (SERA) is a short telephone survey of employers who have recently advertised job vacancies. The purpose of the survey is to identify occupations in which employers are having difficulty filling vacancies.

Research New Zealand was contracted by the Department of Labour to carry out SERA 2007. A total of 4,175 interviews were completed with employers (or recruitment agencies). These employers were attempting to fill a total of 6,930 vacancies[7]. The response rate for the survey was 63%.

Earlier large sample SERA were conducted in-house by the Department in 2003 (February to December), 2005 (May to August) and 2006 (May to October), with no equivalent survey being conducted in 2004.

The survey sample was drawn primarily from the Department's Job Vacancy Monitor[8] (JVM) but was also supplemented from various internet job boards and specialist websites when there was difficulty reaching sample quotas for particular occupations from the JVM. The SERA 2007 sample was stratified on the following basis:

• A total of 2,500 completed interviews covering three major occupation groups: professionals, technicians and associate professionals, and trades workers. A cap of 40 interviews was placed on large occupations, and a minimum of 10 interviews was sought for some small occupations that were thought to be of particular interest.
• A total of 1,700 completed interviews covering all six other major occupation groups. The sample size for each was based on the group's share of total employment.

Employers were approached 6 to 10 weeks after advertising and were asked whether they had filled their vacancy, and the number of suitable applicants (including whether they had the right to work in New Zealand at the time they were interviewed). Employers were phoned back if they had not yet filled the position on offer, but they expected to do so within 10 weeks of advertising.

Vacancies that were not filled with a suitable candidate within 10 weeks of advertising were deemed to not be filled (even if there was some chance of the vacancy being filled after the 10 week cut-off point). It is possible that this business rule may impact on some occupations more than others (e.g. highly paid positions, which are typically advertised through recruitment agencies, may take longer to finalise appointments).

If the appointee to any position did not have the qualifications and experience to be regarded by the employer as a member of the occupation being advertised (e.g. a book-keeper being appointed to an accountant vacancy), then the vacancy was deemed to not be filled.

Weighting

Fill rates presented at the NZSCO 1-digit, 2-digit and 3-digit level were weighted to compensate for any under or over sampling of individual occupations in the survey. Weights were calculated for each occupation[9] with a view to make the vacancy counts from the SERA sample reflective of the total newspaper vacancy counts from the JVM. Data from the 2007 and 2006 SERA were each weighted separately based on vacancy levels in the JVM at a similar time to the survey being carried out. As the JVM does not currently include web-based vacancies or vacancies published in community papers, the weighted fill rates are only reflective of newspaper vacancy counts rather than total vacancy counts.

The SERA carried out in 2003 and 2005 both excluded a few 5-digit occupations from the technician and associate professional occupational group (e.g. sales representatives and technical representatives). As these occupations account for a reasonable proportion of advertised newspaper vacancies within this NZSCO group, the weighted fill rates for the major group from 2003 and 2005 are not comparable with that for 2006 and 2007 (which did include these occupations). For this reason, fill rates are not shown in the report for 2003 or for 2005 for the NZSCO groups 3, 33, and 331.

Sample error

The fill rates presented in this report are subject to sampling error, which must be considered when interpreting the results. The larger the sample size that a fill rate is calculated from (in this case, the number of vacancies included in the SERA), the smaller the sample error will be. For example, the maximum margin of error at a confidence level of 95% for various sample sizes is as follows: