DistantNews
Support us
🇦🇺 Australia /Economy & Trade

Australia's 'Non-Market Sector' Debate Misunderstood, ABS Official Says

From ABC Australia · () English

Translated from English, summarized and contextualized by DistantNews.

At a glance

Analysis Sources not specified Context piece
  • A common graph circulating on LinkedIn incorrectly suggests Australia's productivity issues stem from rapid growth in the "non-market sector."
  • Jason Annabel from the Australian Bureau of Statistics (ABS) clarifies that the "non-market sector" is not synonymous with the public sector or government employment.
  • This sector includes education, healthcare, and public administration, with significant portions of their activity being market-based, such as private hospitals and schools.

A widely shared graph on LinkedIn, purporting to explain Australia's productivity decline, has drawn criticism from an Australian Bureau of Statistics (ABS) official for its simplistic and misleading interpretation of the "non-market sector."

When we talk about the non-market sector, we're talking about three specific industries: education, healthcare, and public administration.

— Jason AnnabelSenior researcher at the Australian Bureau of Statistics, defining the scope of the 'non-market sector'.

The graph suggests that the rapid growth in "hours worked" in the non-market sector, contrasted with slower growth in the market sector, indicates an out-of-control government size. This narrative implies that publicly funded jobs like teaching and nursing are the primary drivers of declining productivity.

My sense is there's been a little bit of confusion over the last few years.

— Jason AnnabelAustralian Bureau of Statistics researcher, commenting on the misinterpretation of the 'non-market sector'.

However, Jason Annabel, a senior researcher at the ABS, explained at a recent seminar that this interpretation is flawed. He clarified that the "non-market sector" is a technical term encompassing three specific industries: education, healthcare, and public administration. Crucially, Annabel emphasized that this sector is not equivalent to the public sector or government employment.

There's been discussion around what's happening in the non-market sector, and it feels to me as though in some quarters there is some kind of confusion that the non-market sector equals the public sector or equals the government, and it's not.

— Jason AnnabelAustralian Bureau of Statistics researcher, clarifying the distinction between the 'non-market sector' and the public sector.

Annabel pointed out that even within these industries, a substantial amount of economic activity is market-based. He provided estimates showing that in healthcare, 55-60% is market-based (e.g., private hospitals), 30-35% in education (private schools and universities), and less than 10% in public administration. He noted the confusion arises from the term "non-market," which was adopted decades ago despite containing market activities, making it difficult to interpret without proper context.

But the problem is it's got market activity in them. It kind of makes it a little bit difficult.

— Jason AnnabelAustralian Bureau of Statistics researcher, explaining the challenges in interpreting the 'non-market sector' data.
DistantNews Editorial

Originally published by ABC Australia in English. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

More Stories

From Our Blog