Australia has huge growth in job vacancies – but that doesn’t mean it’s easy to find one | Greg Jericho – The Guardian
The latest job vacancy figures released yesterday by the Australian Bureau of Statistics show that while things are improving, unemployment will remain high until the impact and restrictions of the pandemic are gone.
It continues to be tough to make sense of economic data at the moment. Wild shifts are still happening, with record growth replacing record falls.
As I noted earlier this week, however, we can say that the employment situation is better than it was.
The Department of Employment’s leading indicator, which tracks a number of different economic surveys to gauge how things are going, has now turned positive for the first time since February 2020.
Admittedly, the index only recorded a score of 0.05, but after what we experienced last year, we’ll take whatever we can get:
And it accords with what we are seeing with job vacancies.
In the May quarter last year, job vacancies fell a record 43%; this was followed by a record rise of 60% in the August quarter. The latest figures released yesterday show that in the November quarter vacancies rose another stunning 23%:
That is, of course, good news, and it is somewhat amazing that vacancies in November were 12% higher in 2020 than they were in 2019.
And the increase in jobs available is across the spectrum of the economy. All industries recorded more vacancies in the November quarter than in August.
Astonishingly, seven industries: manufacturing, utilities, accommodation and food services, financial services, health and social care, and arts and recreation recorded the highest number of vacancies in a quarter since such records began in 2009.
Vacancies in the arts and recreation sector grew by 233% in November:
And yet this does not mean a jobs boom.
It’s part of the problem of economic data at the moment. Usually such a surge in job vacancies is a sign of a very healthy economy; whereas now it is more a sign of an economy moving out of lockdown.
It is good to be sure, but boasting about record growth in vacancies does not necessarily mean we are about to have a record level of employment – rather that last year we had a record number of layoffs.
As it is, the fight for jobs remains mostly tougher than it was prior to the pandemic – if at least not at the absurd levels reached in May last year.
Across the nation, in November there were 3.7 unemployed people for every job vacancy. The hardest states to find work were Victoria, with 4.2 unemployed per vacancy, Tasmania with 4 and Queensland with 3.9.
The best were Western Australia and New South Wales with 2.4 and 3.2 unemployed per vacancy respectively:
It is worth noting that only in NSW and Victoria was the fight to get work tougher in November than it was in February. This is because the number of vacancies more than compensated the increased unemployment.
But this does not really mean it is easy to get work.
What the relationship between the job vacancies and unemployment shows is that the number of vacancies is really an aberration and also that the labour market is massively constrained at the moment.
Economists like to compare the unemployment rate with the “job vacancy rate” (the number of vacancies as a percentage of the labour force). Generally as the rate of one rise the other falls – a high job vacancy rate usually means a low unemployment rate.
In both February and May last year the relationship held, but then in August and November it completely broke:
Normally with the vacancy rate of 1.84% that occurred in November you would expect unemployment to be around 4% – not 6.8%.
What this highlights is the how the struggle with the labour market is that workers are prevented from getting jobs. It’s all very well for there to be a job available, but it is not much good if it is in a place you are not able to travel to. Or if the available jobs are in an industry you can’t to work in (either because it does not suit or you are not qualified).
From May to November accommodation and food services jobs accounted for 13% of the increase in vacancies. Normally they account for just 6.5%. That’s great if you want such a job, but not so much if you don’t – especially given such work is generally lower paid and not full-time.
On the other hand jobs in administration and supply accounted for just 7% of the increase – normally they account for 15%.
And so we have a labour market offering much more hospitality jobs than normal and much fewer admin jobs.
It all makes for a bumpy road out of the pandemic and for many workers the smooth path looks to be well off in the future.
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