Employment Forecast - There is a silver lining
By Michael Emerson
It appears the clouds are parting for the workforce at last, writes Michael Emerson.
The MyCareer Employment Forecast has just been released and things are finally looking up on the jobs front.
This edition reveals that conditions have improved since the November report, when the European debt crisis gripped the world. Since that time the debt situation has improved significantly.
The US market is also improving with job numbers growing, the US housing market is showing signs of life and gross domestic product is growing. Growth in China has slowed but it is still strong.
In response, the Australian job market took a breather in 2011 and the first quarter of 2012 as the nation awaited the outcome of the overseas debt situation. Job vacancies also softened, although they remained at near-record levels. Despite the soft global economic environment, Australia still added 140,0000 jobs in the year to February 2012.
This report is compiled by independent expert EMDA and is published every six months, covering the mainland states and professional and managerial market, as well as key industries.
This report finds that the mining sector remains a standout; in fact, it accounted for 61 per cent of the growth in full-time jobs in the past year. Other sectors have also grown, including health, government and education, but not like mining. The professional and managerial sector is improving as the hiatus that fell on this sector in mid-2011 starts to lift.
The report also finds that salary growth has not been uniform. Salaries in mining continue to outgrow other sectors. They are currently growing at 5.1 per cent a year, as at November 2011, compared with 4.1 per cent a year for all wage earners. In mining, salaries on average are double ($2134 a week) versus $1021 a week for all workers.
Retail a slow mover
On the other hand, in the slumping retail sector, average wages are only increasing at 0.7 per cent a year (November 2011).
Managerial and professional salaries are also moving to a different beat reflecting the differences in the growth of each sub-sector. Managerial salaries are only growing at 1.3 per cent (year to December 2011), which reflects the tougher trading conditions. On the other hand, salaries for professionals are growing at a healthy 4.6 per cent.
The report also finds that twilight careers (workers over the age of 63) remain the fastest-growing segment and numbers have reached record levels. For the first time, the number of people employed in this segment has reached the half-million mark.
With the improved global economic outlook, the rise in Australian business and the rise in consumer confidence in Australia off the GFC lows, the jobs outlook is improving, although growth will be subdued by pre-GFC standards. However, the report finds some sectors, notably manufacturing, will continue to struggle under the weight of the high Australian dollar. Wages and salaries are also forecast to keep growing, much as they have done in the past 10 years.
With a strengthening job market and relatively low unemployment there is limited slack in the labour market. This in turn means that skills shortages will only grow more for Australia as the economy grows.
EMDA is an economic and market research consultancy that prepares the MyCareer Employment Forecast on behalf of Fairfax Media. Michael Emerson is a director of EMDA and has more than 20 years' experience as a market economist.
Published: 05 May 2012
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