In the wake of Labor's shock election loss and Bill Shorten's decision to step down as leader, political attention has focused on who will take the party forward.

But how does the process work and when can we expect the new leader to be chosen?

That all depends on what happens next.

Who are the contenders?

At this stage, Shadow Infrastructure Minister Anthony Albanese is the only declared candidate for the Labor leadership.

"Albo", as he likes to be known, is from the party's left faction and unsuccessfully ran against Bill Shorten in 2013.

He was set to face off against right faction candidate and Shadow Treasurer Chris Bowen, however Mr Bowen pulled out from the race yesterday, saying he did not believe he could beat Mr Albanese.

Shadow Finance Minister Jim Chalmers is also still a potential candidate, taking to Twitter after Mr Bowen withdrew to say he was being encouraged to run and that he would consider his options overnight.

Jim Chalmers is from Labor's right faction. ( ABC News: Matt Roberts )

High-profile female MPs Tanya Plibersek and Penny Wong have ruled themselves out, with Ms Plibersek citing family reasons and Senator Wong saying she did not want to move to the Lower House.

Senator Wong is among a number of MPs backing Mr Albanese, including Tony Burke, Joel Fitzgibbon, Kristina Keneally and Catherine King.

What happens from here?

Rules introduced by former prime minister Kevin Rudd mean the Labor leader is chosen by both its parliamentary and rank-and-file members.

If a second candidate enters the race, Labor members across the country will be given the chance to have their say through a postal ballot.

The Labor caucus (all of its MPs and senators in Federal Parliament) will also vote, with both results then given equal weighting and added together to determine the winner.

In 2013, Mr Albanese won more of the rank-and-file vote but lost to Mr Shorten after failing to gain enough support in caucus.

So when will we know the outcome?

Labor's national executive met last night to officially kick off the leadership process.

Nominations will open at 10:00am and will close at 10:00am on Monday, May 27.

If a second candidate nominates, the following timeline would apply:

Friday, May 31: Postal ballot opens Thursday, June 27: Postal ballot closes Monday, July 1: Caucus meets to vote

To be considered for the leadership, a candidate must be nominated in writing by at least 20 per cent of caucus members.

What about the deputy?

The deputy's position is a matter for caucus alone to decide, although the need for factional balance usually means they end up coming from a different faction to the leader.

That means that if Mr Albanese wins, current deputy and left faction colleague Ms Plibersek would be unlikely to stay on in the role.

Other names being suggested for deputy are Mr Chalmers, Tony Burke and Richard Marles, who are all from the party's right faction.

Tanya Plibersek (right) has been Labor's Deputy Leader since 2013. ( AAP: Dan Himbrechts )

What about female representation?

The Labor Party prides itself on its level of female representation in parliament, but at this stage it looks like male candidates could be chosen for both the leader and deputy roles.

ALP national president Wayne Swan said he did not have an issue with that, as he expected women to fill other senior parliamentary positions.

"I'm not disappointed, I think you'll find there'll be nominees in the Senate and we'll be strongly represented in the Senate," he said.

"So if you look at the balance of the leadership overall I think we'll continue a very fine and exceptional record."

Senator Wong is expected to keep her role as Labor's leader in the Senate, while Kristina Keneally's name had been floated as a possible deputy.

Senator Keneally said those positions would be determined by her colleagues.

"We have a very strong team of people both in the Senate and in the House, and in whatever capacity I can be useful I'm happy to do so," Senator Keneally said.

Kristina Keneally's name has been floated as a possible deputy. ( ABC News )

What happens to Bill Shorten now?

Mr Shorten will stay on as outgoing Labor leader until someone else is chosen to fill the role, saying he would like to see the process completed as quickly as possible.

Mr Shorten has committed to staying on as the member for the Melbourne seat of Maribyrnong.