Functional Economic Regions and Labour Underutilisation

Abstract

This paper addresses labour underutilisation and considers the factors that are associated with underutilisation risk of individuals embedded in diverse labour market regions. Taking survey and census data for Australian functional economic regions, this paper applies a broad framework that presents the risk of underutilisation as a function of individual characteristics, personal circumstances, and labour market characteristics. The analysis finds that employment outcomes are associated with individual characteristics and circumstances plus regional labour market conditions. The findings indicate that policy designed to address labour underutilisation needs to focus on the outcomes of a multilevel framework in order to be effective.