A shortage of jobs, but no shortage of work

In contemporary Australia there might be a (relative) shortage of jobs, but it seems there is no shortage of work.
While the unemployment rate hovers just below 6 per cent (it held steady at 5.7 per cent last month according to the latest official labour force figures), just about anyone with a job will tell you that their work demands are rising relentlessly.
So what is going on?
The latest official employment figures are consistent with a trend that emerged in the middle of last year in which employment growth is slowing but hours worked is accelerating (see Reserve Bank of Australia chart of labour input growth below).

10bl-labinpu

According to the Australian Bureau of Statistics, aggregate hours worked increased marginally in both trend and seasonally adjusted terms last month, while employment and unemployment were flat (a net 1100 jobs were created, while an additional 9000 job seekers joined the labour market).

The increase in pressure on those still with a job has been accentuated by the inclination of employers to take on part-timers over full-time staff – in the 12 months to October, 53,000 full-time jobs were lost, while during the same period 145,000 part-time positions were added.

Business surveys and the latest job ads report from the Australia and New Zealand Banking Group suggest wary employers are reluctant to take on extra staff.  According to the ANZ, the number of job ads has bottomed in the last two months after falling for most of the year, while an Australian Chamber of Commerce and Industry index of labour market conditions reached a four-year low of 43.6 points in the September quarter.

It is not hard to see why: though low interest rates have injected some vigour into the housing sector, the economy remains sluggish.

As RBA Governor Glenn Stevens observed earlier this week, the economy is still fumbling its way forward as the mining investment boom rapidly dissipates and other sources of growth are yet to establish themselves.

Couple this with the continued strength of the dollar and tepid global growth, and it is little wonder businesses are reluctant to take on extra staff.

Instead, as the data indicate, employers are choosing to use their existing workforce to cope with any increase in demand.

This is why those who have a job feel like they are working twice as hard, even as hundreds of thousands are banging on the door looking for employment.

Advertisements

Leave a comment

Filed under Uncategorized

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s