March 8, 2012


Australia's jobs market is still flat. Jobs are growing strongly in Western Australia, but collapsing in Victoria. That's the real message coming out of the labour force figures released by the Bureau of Statistics today.   



On the seasonally adjusted measures that people are used to focusing on, job numbers zagged after last month's zig.

In the past few months, job numbers rose in November, fell in December, rose in January, and now fell in February: down by 15,000, to end up back where they started.

Brakes are on ... Australia's employment rate has slowed down.

The mining sector is adding jobs - just not enough.

The headline unemployment rate climbed back to 5.2 per cent.

This shows the naivety of comments last month by Treasurer Wayne Swan and the Reserve Bank seeing the January figures as a sign of improvement, rather than the statistical static you get when you try to use figures for the wrong purpose.

The bureau keeps warning us that its monthly job movement figures are too imprecise to rely on, and urges us to use its smoothed trend data instead.   

Pity the Treasurer and the Reserve don't listen.

And the trend figures this month tell us pretty much what they told us last month: there's virtually no job growth going on out there.

Every month, the potential labour force of people aged 15 and over grows by 18,500, but on average, only 1000 new jobs are created.   

Soft spots

That fits with what the bureau told us yesterday: economic growth has gone soft, above all in the south-eastern states with no coal, iron ore or new natural gas fields.

The economy's output grew at an annual rate of just 2.5 per cent in the second half of 2011, with the great bulk of that going into developing new mines in WA and Queensland.

They don't employ that many people, since much of the equipment is imported, and mining is a capital-intensive industry that employs just 2 per cent of the workforce.   

By contrast, the jobs are going from labour-intensive sectors such as manufacturing, retailing, finance and government, which are mostly in the south-east.

That's why Victoria has lost 30,000 jobs since last April, while WA has added 30,000. NSW, South Australia and Tasmania are also losing jobs on balance, but at a slower rate.

In the past couple of months, even Queensland has gone backwards.

Jobs riddle

But if job growth has virtually stopped, and the potential labour force is growing by more than 200,000 a year, why is the unemployment rate stuck at 5.2 per cent instead of rising into the sixes?.   

Because more than 100,000 people who would normally be in the workforce have stopped looking for jobs, and hence don't count in the figures.   

Why? That's the real riddle in these figures, and no one can fully explain it. Most of the people dropping out live in NSW or Victoria.

About a third of them seem to be teenage students deciding not to look for a part-time job. Some of it reflects the ageing of the population, although that is offset by the rapid rise in the proportion of older people staying at work.

But it wasn't happening a year ago. It's another sign of a weakening economy.




comments


            I know what they can do with their figures. Im in WA in the building industry. I work as a commercial estimator, we have been hurting for 2.5 years now just scraping by.

            The job section in the building industry is the worst I have seen it since the early nineties.   


        Commenter
            Dismal scientist
        Location
        Date and time
            March 08, 2012, 5:35PM

            As i said, they can stick their figures, if the WA economy is the leader then we are all in for world of hurt and Im talking major. All we need is lay offs and mortgage collapses and guess who we will look like. 

            My job puts me 9-12 months ahead of the curve, no arguments.

            WE NEED RATE CUTS NOW, WAKE UP!!.   

        Commenter
            Mark
        Location
            Perth
        Date and time
            March 08, 2012, 6:01PM

        Well when the Howard Govt changed the rules so if you are employed for even one hour a week be it paid or a volunteer you are considered fully employed.   
        Just by doing that alone your cooking the books in a massive manner. Sadly Labor saw little currency in changing it back.
        Time to rid ourselves of both parties and try some one else as they just aint working.      

    Commenter
        MickBS
    Location
        Hidden unemployed
    Date and time
        March 08, 2012, 2:10PM


Read more: http://www.theage.com.au/business/jobs-riddle-hints-at-weakening-economy-20120308-1um2h.html#ixzz1oVkImh57

buzzanddidj wrote on Mar 9^th, 2012 at 12:25am: