## Labor Market Adjustments to Shocks in Australia

_IMF Working Papers, May 24, 2017_

## Source details

**Canonical URL:** [Labor Market Adjustments to Shocks in Australia](https://www.imf.org/en/publications/wp/issues/2017/05/24/labor-market-adjustments-to-shocks-in-australia-44947)

## Other formats

- [Markdown version](/en/publications/wp/issues/2017/05/24/labor-market-adjustments-to-shocks-in-australia-44947/index.md)
- [Structured JSON version](/en/publications/wp/issues/2017/05/24/labor-market-adjustments-to-shocks-in-australia-44947/index.json)
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## Bibliographic details
- Authors: Adil Mohommad
- Published: May 24, 2017
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781484301760.001

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### Key research questions and scope
- Examines adjustment of Australian labor markets to significant declines in commodity prices, focusing on:
  - Evidence of increased labor market frictions following the commodity price decline.
  - Flexibility in labor input adjustment in response to demand shocks.
  - Changes in labor productivity in the wake of resource reallocation with the decline in mining investment.
  - The role of migration in adjusting to the commodity price and mining investment cycle.

### Main findings
- Little evidence of increased labor market frictions with the decline in commodity prices.
- The relatively smooth transition has been assisted by increased flexibility in adjustment of worker hours over time.
- Labor productivity growth has sustained its historical average through the transition, despite some temporary drag as the economy rebalances.
- Migration has played a key role in labor market adjustment through the commodity cycle.

### Subject areas and keywords
- Subject: Employment, Labor, Labor markets, Labor productivity, Production, Unemployment
- Keywords: economic flexibility; Employment; equilibrium unemployment value; Global; growth in services sectors; IMF staff calculation; IMF staff estimate; labor market; labor market dynamics; labor market slack; Labor markets; Labor productivity; labor productivity growth; labour productivity gap; Unemployment; WP

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## Content in this bundle

- **Labor Market Adjustment to Shocks in Australia, WP/17/124, May 2017**
  - [Labor Market Adjustment to Shocks in Australia, WP/17/124, May 2017 (Markdown version)](/-/media/files/publications/wp/2017/wp17124.pdf.md){rel="alternate" type="text/markdown"}
  - [Labor Market Adjustment to Shocks in Australia, WP/17/124, May 2017 (PDF)](/-/media/files/publications/wp/2017/wp17124.pdf){rel="external" type="application/pdf"}

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_Source: https://www.imf.org/en/publications/wp/issues/2017/05/24/labor-market-adjustments-to-shocks-in-australia-44947_