The last few days in Australia has highlighted a strong surge in jobs as the economic recovery is on track. The stimulus package was intended to keep people working.The results were a surprise to the markets as there was an expected lag effect.
The headlines on Friday 11 December:
- Jobs surge as recovery gathers pace (Australian Financial Review)
- CEOs warn on jobs squeeze (The Australian)
- Sting in jobs cheer (Business Daily Herald Sun)
- Jobs surge as recovery gathers pace (Australian Financial Review)
- CEOs warn on jobs squeeze (The Australian)
- Sting in jobs cheer (Business Daily Herald Sun)
The pertinent facts and figures are:
- Almost 100,000 jobs have been added to Australia's economy in the past three months
- A hefty 31,200 jobs were added in November
- A solid 30,800 full-time positions made up the bulk of new positions
- Victoria state added the most new jobs
- Almost 100,000 jobs have been added to Australia's economy in the past three months
- A hefty 31,200 jobs were added in November
- A solid 30,800 full-time positions made up the bulk of new positions
- Victoria state added the most new jobs
Unemployment
The unemployment rate dipped to 5.7% - the same as earlier in March this year, and down from 5.8% in October. This rate is a major contrast to the formal projection of 8.5%, which seemed high at the time. These figures are revised every six months and mid-year financial outlook will be released towards the end of the year.
The unemployment rate dipped to 5.7% - the same as earlier in March this year, and down from 5.8% in October. This rate is a major contrast to the formal projection of 8.5%, which seemed high at the time. These figures are revised every six months and mid-year financial outlook will be released towards the end of the year.
Most economists expect a peak of a little over 6%. The Deputy Prime Minister stood by official forecasts that unemployment would reach 6.75% in the middle of next year. However, as it is now clear and undeniable that job losses have bottomed around July, these figures can only be political justification for the on-going spending by Government.
Implications
The fastest job growth in three years has significant implications for employers and employees - higher interest rates, skills shortages, pay demands, higher turnover, and more recruiting.
The fastest job growth in three years has significant implications for employers and employees - higher interest rates, skills shortages, pay demands, higher turnover, and more recruiting.
Higher interest rates - rates will continue rising and we have seen the Reserve Bank moving away from other major central banks lifting rates in October, with a rate rise only a week ago.
Skills shortages - some CEO's are already concerned that we will experience skills shortages in certain industries, particularly with increased demand from resource projects.
Pay demands - as many companies implemented pay freezes over the last year, new staff insisting on higher pay packages will put pressure on pay equity for existing staff. Companies will also need to consider some catch-up increases to avoid lagging the market. Unions have been reasonably conservative with their pay demands and will leverage any shortages of trades people to target higher pay increases.
Higher turnover - as the general confidence improves there will be an increase in staff turnover, as many employees are waiting for the new calendar year to start looking for new job opportunities
More recruiting - there has been strong anecdotal evidence from my recruiter network that there was a significant pick-up in the number of current assignments. The top end is still patchy but also starting to get some signs of life. We all look forward to a busy 2010.
Outlook
In summary, the economic recovery is gaining momentum and we appear to be sailing into 2010 with a better outlook as a year ago, which must be good news.
In summary, the economic recovery is gaining momentum and we appear to be sailing into 2010 with a better outlook as a year ago, which must be good news.
Charles van Heerden is the founder of WaveBox a specialist Strategic HR and OD consulting firm in Melbourne, Australia. Charles is a job search expert with a strong focus on talent management. He has been an HR Director in three countries, a senior line manager and a consultant. Charles holds a degree in Psychology and has completed advanced studies in HR and change management. He enjoys blogging about job search, recruitment and managing change.
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