Background

Occupational forecasting is described as forecasts of employment by occupations and skill groups. Many countries have developed systems of occupational forecasting and with several years of experience in implementing them across numerous occupations and industries. In Australia, the occupational forecasting effort has been underway for more than 30 years. It is facilitated by the Department of Employment and Workplace Relations (DEWR) with the major General Equilibrium modeling effort (ie, MONASH model) and the labour market extensions carried out at Monash University by the Centre of Policy Studies (CoPS).

Rationale

An assessment of future labour market outcomes is of considerable interest to policy makers and for those making operational decisions with respect to training. These could take the form of forecasts of employment by occupations and skill levels or needs at the national, sectoral or the regional level. The priorities of forecasting labour market outcomes of employment by industry and occupations within the Department of Labour, is the potential to contribute towards policy development and programme design in the areas of Immigration policy (both skilled migrant categories and temporary worker schemes) and with funding priorities associated with tertiary education and industry training. The contribution to the Skills Insight is in the context of providing some assessment of the medium-term future in relation to recent history.

Methodology

The forecasts in the Department are undertaken using the industry and occupational employment estimates generated within the Department over the past year or so using a number of different data sources on employment and the 2006 Census data to incorporate more recent occupational changes. The analysis is also carried out using a number of scenarios covering industrial GDP growth, plausible labour productivity assumptions and occupational composition changes, as appropriate.

Key steps involved in industry and occupational employment forecasting are:

• Exploring options for GE model outputs of industry GDP forecasts in New Zealand
• Investigating steps to derive employment forecasts from GE model outputs
• Projecting occupational shares by industries or sectors in the medium term
• Deriving employment levels by occupations across industries in the medium term.

Outputs

• Industry employment forecasts at the 1-2 digit ANZSIC level (or 28 industries);
• Occupational employment forecasts at the 3-digit NZSCO level (or 96 occupational groups)
• Forecasts updated periodically and at least twice a year, in September and in March each year.