Regional unemployment disparities and the affect of industrial diversity

The aim of this research is to demonstrate by data analysis that significant variations in regional unemployment rates still exist in today’s relatively low unemployment rate Australian economy. This analysis then draws conclusions as to whether these variations have any links to the level of industry diversification within the case study area and NSW Australian Bureau of Statistics (ABS), Statistical Districts (SDists), with a view to regional policy development and further research. This research used ABS Census of Population and Housing data, to empirically investigate trends in regional unemployment rates in forty nine, non capital city, ABS Statistical Divisions (SDs) throughout Australia, for the period 1986 to 2006. This study furthers the research of Howard and Buultjens (1999), and establishes that regional unemployment disparities, which occurred in Australia’s SDs from 1986 to 1996, continue through to 2006 albeit to varying degrees. This research also uses ABS Census of Population and Housing data to explore whether there is a correlation between the level of regional industry specialisation and regional employment outcomes by disaggregating the SDs of N.S.W. into fourteen SDists, to compare unemployment outcomes from 1996 to 2006, with industry diversity levels in these SDists, over the same period. The national average index of industrial diversity measurement is used to aggregate regional industrial diversity levels. This research found that some NSW SDists have become more industrially diverse while others have become more industrially specialised over the study period. Generally there has been an overall improvement in unemployment outcomes at the SDist level over the study period however this could be argued to be symptomatic of years of increased GDP spilling over to the regions rather than specific industrial diversity outcomes. Further not all outcomes reflect the commonly held view in the literature that industry diversity leads to lower unemployment. Specific industry categories within SDists are more likely to affect unemployment outcomes than an overall industry national average index score