What economic factor is primarily attributed to the high level of unemployment at 10.7% in 1992-3?

The high level of unemployment at 10.7% during the period of 1992-3 can primarily be attributed to the impact of recession. During a recession, economic activity slows down significantly, leading to decreased demand for goods and services. This, in turn, causes businesses to cut back on production, leading to layoffs and higher unemployment levels as companies look to reduce costs in response to lower consumer spending.

In the early 1990s, many economies, including Australia's, were dealing with the aftermath of a recession that began in the late 1980s and persisted into the early 1990s. Factors such as decreased consumer confidence, rising bankruptcies, and a decline in investment all contributed to the economic downturn, directly influencing the spike in unemployment rates.

When an economy is in a recession, it's common for businesses to freeze hiring or reduce their workforce, leading to an increase in the unemployment rate, which was starkly reflected in the figures of that period. Understanding the connection between the recession and high unemployment can help analyze how economic cycles impact the labor market and overall economic health.