Jobs point to restructure

The ABS released its Job Vacancies for February survey today. The overall release was a slight seasonally adjusted fall. More interesting is the industry split. The first chart below is for sectors with rising job ads for the month:

And the second is for sectors with falling job vacancies for the month:

This industry sector split is a relatively new series from the ABS. However, it clearly shows the transformation underway in the economy with manufacturing falling since mid last year and, more recently, retailers clearly overestimating Christmas then jamming on the brakes lately. The stellar performer, albeit with a recent fall, is administration.

On the upside it’s all about construction and professional services (science, technical and white collar jobs) with a steady rise in mining off a low base. It is likely, however, that given nothing else is growing, that both construction and professional services are enjoying knock-on benefits from the mining boom in the form infrastructure, mining research and development, as well as other associated white collar jobs.

There’s a bob each way in these figures for the discussion around economic restructure. As regular readers will know, I’m no fan of letting the non-resource export sector carry the burden of restructure through a high dollar. In my view, it’s analogous to the pro-cyclical thinking that got us into the GFC. Back then it was don’t lean against private sector asset-growth and over consumption. Now it’s don’t lean against private sector over-reliance on mining.

At the same time, there is clear need of skills in the growth sectors.

To address that I would much rather see less government spending, better targeted training investment and higher immigration than I would the shedding of industries that we will never see again.

To be blunt, I’d rather Colorado go bust than an Australian exporter of rubber sex toys.

Houses and Holes

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the fouding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.

He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.

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Comments

  1. “skills in the growth sectors.

    To address that, however, I would much rather see less government spending, better targeted training investment and higher immigration than I would the shedding of industries that we will never see again”

    I doubt there is any link between the (small) needs of the resource sector and the shedding of pretty much everything else.not very exclusive, poor government and stupidly high dollars are the culprit.

    I really don’t care about carbon but I frankly do not see any other best solution than developing a very strong green sector that could help us overcome our 2 speed economy with high skills jobs (not digging holes) that can not be outsourced, lot of research and new industry players, and overall with high societal benefit (and would free coal/gas for export).

    The failure to implement a real mining tax that could have help Australia’s future is a shame that will last.

  2. Don’t know, I think there is more down than up. I still know quite a few IT Professionals and Engineers that had jobs before 2008, that are really struggling to find work back in their industries.

    What categorises the Science sector? How do they count or determine vacancies?

    I know a few market researchers too that have stated they have seen better times too.

  3. I work for one of the largest recruitment companies in the world in the construction, property and engineering sector in Melbourne.

    The top graph doesn’t ‘feel’ right when I look at it (may just be the market here in Melbourne)

    Resi design/build vacancies have dropped off massively since late last year and have not picked up again yet, clients are now saying they can find staff easily through seek.com.au and are not putting as many vacancies out to recruitment agencies (I question the near ‘full employment’ rate that keeps being spoken about).

    I agree with Mining and Resources as that has been very steady.

    Architecture/Design is the first to drop off and did so massively in 2009. That market is nowhere near as busy as it was this time last year in Melbourne.

    Or maybe I’m not doing my job as well as I should!

  4. STC,

    That’s very interesting and accords with what my own network is saying.

    I also graphed the state by state vacancies. And Victoria was still the star performer so I’m a bit stumped.

    Perhaps immigration has filled the hole?

  5. Quite possibly.

    A lot of candidates in construction have moved from interstate over the last 12 months to live in work in Vic. Also many Kiwis and an unprescedented amount of candidates from the UK and Ireland have found their way over here since the EU sovereign crises.

    Last year I was placing a lot of EU expats into work but also found many companies were hesitant to sponsor visas. Many candidates were on working holiday visas so took 6 – 12 month contract roles. They love an Irish draftee in this market.

    Just had a look at the Seek index for Feb too – It also sites Vic as the star performer for February and Architecture as the most candidate short market! I work in architecture and can say for certain that only very specialised roles are candidate short such as registered architects with industrial expertise. It was my clients in the volume home build sector (FHB territory)that told me they would no longer be requiring our services for designers and drafters. Interesting.

    Seek stats (like all) you have to take with a grain of salt though as we recruiters have an allotment of ads we can post each month(in the many hundreds) and mutilple agencies will post ads for the same jobs. Its not uncommon to see 6+ agencies all posting multiple ads for one role which will severely inflate the current vacancy stats.

    I wonder if ABS uses the Seek index in gathering theirs?

  6. Hi STC…

    That is interesting and I dont doubt what you are seeing – although I work for an Architecture firm here in Melbourne (we are only 3 guys) and we have never been busier.

    All, and I mean all – of our work here in Australia is for Asian clients (we are currently getting at least 1 new project a day – from dual-occ’s to apartment buildings) obviously the asians are believing the crap the spruikers are saying or they are happy to get the money out of China for investment.

    Also we have some really big projects on the go overseas (3 convention centres, 1 airport, and numerous other jobs).

    I think we must be lucky as I do know alot of others who have sweet FA work in the industry……

    Bring on the Crash I say…!

  7. Being self employed in the construction industry I have for many years always checked out the employment section in The Age Newspaper every Saturday for Architects-Construction-Engineering-Mining. Pre GFC this section always took up at least 2 pages, post GFC it is only a 2 or 3 columns-a big drop off in advertising.
    I also check out similar jobs on line. Type in Construction Engineer and many jobs appear, look further and they are all the one job adverised many times.