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Labour Market Adjustment in Regional Australia


  • Jeremy Lawson

    (Reserve Bank of Australia)

  • Jacqueline Dwyer

    (Reserve Bank of Australia)


Over the past two decades, there has been a marked divergence in regional labour market outcomes within Australia. In this paper, we examine two aspects of this divergence. First, we analyse the wide variation in employment growth rates, finding that stronger rates of employment growth were associated with industry structure, proximity to factor and product markets, and the level of regional amenity. Second, we investigate how regional labour markets adjusted to different employment conditions. While regional migration is found to be the dominant adjustment channel, the relative strength of the migration adjustment differs across regions. Out-migration, accompanying employment declines, was stronger amongst regions with initially high unemployment rates and low regional amenity. Similarly, regions with initially low rates of unemployment and high regional amenity experienced stronger rates of in-migration in response to rising employment.

Suggested Citation

  • Jeremy Lawson & Jacqueline Dwyer, 2002. "Labour Market Adjustment in Regional Australia," RBA Research Discussion Papers rdp2002-04, Reserve Bank of Australia.
  • Handle: RePEc:rba:rbardp:rdp2002-04

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    References listed on IDEAS

    1. Edwarad L. Glaeser & Jesse Shapiro, 2001. "Is There a New Urbanism? The Growth of U. S. Cities in the 1990s," Harvard Institute of Economic Research Working Papers 1925, Harvard - Institute of Economic Research.
    2. repec:hoo:wpaper:e-95-4 is not listed on IDEAS
    3. McGuire, P, 2001. "Regional unemployment in Queensland: Dimensions and policy issues," Australian Bulletin of Labour, National Institute of Labour Studies, vol. 27(4), pages 296-313.
    4. Gregory, R.G. & Hunter, B., 1995. "The Macro Economy and the Growth of Ghettos and Urban Poverty in Australia," CEPR Discussion Papers 325, Centre for Economic Policy Research, Research School of Economics, Australian National University.
    5. Glaeser, Edward L. & Scheinkman, JoseA. & Shleifer, Andrei, 1995. "Economic growth in a cross-section of cities," Journal of Monetary Economics, Elsevier, vol. 36(1), pages 117-143, August.
    6. Greenwood, Michael J, 1975. "Research on Internal Migration in the United States: A Survey," Journal of Economic Literature, American Economic Association, vol. 13(2), pages 397-433, June.
    7. Boyd Hunter, 1995. "The Social Structure of the Australian Urban Labour Market: 1976-1991," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 28(2), pages 65-79.
    8. Guy Debelle & James Vickery, 1999. "Labour Market Adjustment: Evidence on Interstate LabourMobility," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 32(3), pages 249-263.
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    Cited by:

    1. Robert J. Stimson, 2012. "Endogenous Factors in Regional Performance: A Review of Research in Australia," Chapters,in: The Regional Economics of Knowledge and Talent, chapter 6 Edward Elgar Publishing.
    2. Ernst Juerg Weber, 2006. "Monetary policy in a heterogeneous monetary union: the Australian experience," Applied Economics, Taylor & Francis Journals, vol. 38(21), pages 2487-2495.
    3. Robert Stimson & Alistair Robson & Tung-Kai Shyy, 2009. "Modeling regional endogenous growth: an application to the non-metropolitan regions of Australia," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 43(2), pages 379-398, June.

    More about this item


    migration; regional labour markets;

    JEL classification:

    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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