Friday, April 13, 2012

In the jobs zig-zag, the zigs are getting bigger

AN UNEXPECTEDLY large rebound in jobs has helped NSW reach a record level of employment in March, and cut the headline unemployment rate below 5 per cent for the first time in a year.
In another sign that the state is moving on from its sluggishness over the past decade, seasonally adjusted employment rose for the third month in a row in March, and has now retraced all its 2011 losses.

Seasonally adjusted employment climbed 19,100, mostly in part-time jobs, but with a net 7800 gain in full-time jobs. Unemployment dived from 5.1 per cent to 4.8 per cent.

The Australian dollar soared almost a cent yesterday, and financial markets became less certain about another interest rate cut after the seasonally adjusted figures nationally traced a spectacular zag to last month's zig, with a gain of 44,000 jobs.

It was the fourth month in a row that the figures followed a zigzag pattern, falling and rebounding. But the rebounds have been bigger than the falls, and in March, seasonally adjusted employment climbed to a record of just under 11.5 million Australians in work.

Unemployment remained at 5.2 per cent, with thousands of people coming off the sidelines to look for work. Over the past year, most of the growth in the adult population has been among people who are neither employed nor unemployed, just not looking for work.

But economists pointed out the zigzag pattern of recent months suggests the figures could give a misleading impression, with no certainty that the rise in March will be sustained.

The Bureau of Statistics points to its trend figures, which smooth out the zigs and zags. They show slow growth in employment, with just 25,000 jobs added in the past six months, enough to employ only a fraction of the 118,500 growth in the working age population.

The rebound in NSW is sustained on the trend measure. Even after taking out zigs and zags, the state has added 25,000 full-time jobs in the past six months. While total employment grew just 6000, unemployment fell from 5.4 per cent to 5 per cent.

Western Australia remains the jobs dynamo, after a year in which the amount spent on mining investment climbed more than the entire growth in gross domestic product. In the past six months, the trend figures estimate Western Australia has added 31,000 jobs, while Victoria has lost 23,500.

NSW has now overtaken Victoria as the best-performing state in the south-east, with the first buds of a housing recovery, new mining investment and exports, and solid consumer spending insulating it from the slump in the rest of the south-east.

The state Treasurer, Mike Baird, gave the figures a cautious welcome. "While the current environment is an ongoing challenge ... it's pleasing to see that total employment rose 19,100," he said. "This puts us second to Western Australia in jobs growth.

"However, significant economic uncertainty remains, and we expect that this will put further pressure on jobs over the coming year."