Westpac is out with its unemployment expectations index and it shows some hopeful trends:
That’s good news but I’m skeptical beyond six months. Here is why. Expectations are tracking firmly improving hours worked:
But the work is all in the two bubble states. NSW is booming:
As is Victoria:
But where there is no bubble, there are no jobs:
NSW and VIC jobs have badly lagged hours worked because nobody believes the bubble is sustainable. That’s not a lack of “confidence” as the RBA would have it, it is common sense. Moreover, the two bubble states are now under intensifying attack from regulators, banks and crimped Chinese investment.
Meanwhile, all other states remain in funks of various depths that are going to get worse as the mining bust deepens. So, when the two eastern states stall out with house prices in the nearish future, it’s all over red rover for national jobs growth.
In the meantime, Westpac also released its jobs index for October which shows that for now the labour market is OK:
Enjoy it while it lasts.
