Significant shortage of education & health workers
Skilled Job Vacancies
Skilled job vacancies: In trend terms, the Internet Vacancy Index rose by 0.4 per cent in July – the first rise in seven months. Record vacancies exist for health and education workers.
The internet job vacancies data is a leading indicator of the job market and therefore important for consumer-focussed stocks and companies.
What does it all mean?
• The latest data is encouraging, suggesting that the economy is starting to shed the pre-election weakness. Job vacancies are up for the first time in seven months with gains across most regions and most occupational groups.
• Especially encouraging is the fact that high unemployment regions in South Australia and Tasmania are recording significant growth of job vacancies. The hope is that skilled labour is available to fill the vacancies. Notably Tasmanian job vacancies are at 8-year highs in trend terms.
• While NSW job vacancies are easing, the declines are from a high base. The NSW job market could still be regarded as at ‘full employment.’
• Of the 172,000 available positions, a record number of close to around 30,000 positions need to be filled in education, health and community services, with staff in demand across all states and territories.
What do the figures show?
• The Department of Employment Internet Vacancy Index rose by 0.4 per cent in July – the first rise in seven months. The index is 5.5 per cent lower than a year ago although it is up 11.2 per cent above the level recorded five years ago.
• In July 2019: “Job advertisements rose in six of the eight occupational groups, with the strongest rises recorded for Labourers (up by 1.1 per cent) and Community and Personal Service Workers (0.6 per cent). Job advertisements decreased for Managers and Sales Workers (both down by 0.4 per cent).
• Over the year to July 2019: “Job advertisements fell in six of the eight occupational groups, with the strongest falls recorded for Machinery Operators and Drivers (down by 15.5 per cent), Sales Workers (11.8 per cent) and Labourers (10.3 per cent). Increases were recorded for Community and Personal Service Workers (up by 5.6 per cent) and Professionals (1.3 per cent).”
• Over the year to July 2019, 12 of the 48 detailed occupational groups recorded increases in job advertisements. “The largest increase was recorded for Education Professionals (up by 1170 job advertisements), followed by Health Diagnostic and Therapy Professionals (720), Carers and Aides (640), Medical Practitioners and Nurses (600) and Health and Welfare Support Workers (220).
• “The largest decrease was recorded for Corporate Managers (down by 1080 job advertisements), followed by Sales Assistants and Salespersons (1070), General-Inquiry Clerks, Call Centre Workers, and Receptionists (960), Drivers and Storepersons (820) and Construction, Production and Distribution Managers (800).
• Job vacancies increased in seven states and one territory in July: NSW (down 0.8 per cent), Victoria (up 0.2 per cent); Queensland (up 0.6 per cent); South Australia (up 1.2 per cent); Western Australia (up 1.1 per cent); Tasmania (up 1.5 per cent); Northern Territory (up 1.1 per cent); and ACT (up 1.4 per cent).
• Over the year to July 2019, job vacancies rose in four states and territories: NSW (down 11.7 per cent), Victoria (down 6.5 per cent); Queensland (down 2.4 per cent); South Australia (up 4.4 per cent); Western Australia (up 1.1 per cent); Tasmania (up 13.2 per cent); Northern Territory (down 4.4 per cent); and ACT (up 11.8 per cent).
• Over the year to July 2019, in three month moving average terms, job advertisements increased in 21 of 37 regions. The strongest increases were recorded in Yorke Peninsula & Clare Valley SA (up by 36.2 per cent), Port Augusta & Eyre Peninsula SA (24.7 per cent), Hobart & Southeast Tasmania (18.9 per cent), South West WA (18.0 per cent) and Dubbo & Western NSW (17.2 per cent).
What is the importance of the economic data?
• The Department of Employment releases a monthly Internet Vacancy Index. The index is based on a count of online job advertisements newly lodged on three main job boards (SEEK, CareerOne and Australian JobSearch) during the month. The index is the only publicly available source of detailed data for online vacancies, including around 350 occupations (at all skill levels), as well as for all states/territories and 37 regions.
What are the implications for interest rates and investors?
• How much spare capacity is available in Australian job markets? It certainly varies substantially from profession to profession and region to region, Wage pressures have the potential to develop further in health, education, mining and community services sectors, putting pressure on company profits in those sectors.
• The Reserve Bank Board has indicated that it is now assessing information before deciding the next move on rates.
• The next key event is a speech by the Reserve Bank Governor on Sunday morning, Australian time, at the Jackson Hole, Wyoming symposium for central bankers.
Published by Craig James, Chief Economist, CommSec