Australiaís Labour Market Strengthens and Tightens

SEEK Employment Index data released today suggests that the Australian labour market is strengthening and tightening after a significant downturn in July. The total number of new positions advertised across Australia rose by 3.2% in August (seasonally adjusted), which reverses the 1.1% decline recorded in July.

Overall, the national picture is a healthy one. The reversal of last monthís decline in the number of ads posted was particularly evident in Queensland (a rise of 10.5%) and New South Wales (a rise of 5.8%). The boom in Australiaís resource-rich states continues to grow, with Queensland and Western Australia combined showing a 44% increase in the number of job ads posted over the last 12 months, highlighting the favourable economic conditions both are currently experiencing.

Nationally, the number of job applications for positions listed on SEEK increased by only 0.2% in August 2006, which indicates a tightening of the current labour market.
Applications are particularly subdued in Western Australia. In the year to 2006, the number of applications has increased by only 18.6% compared to a 53.5% increase in the number of new jobs advertised in the same period.

The SEEK Employment Index (EI), developed in conjunction with Victoria University is an aggregate indicator that measures labour market supply compared to labour market demand, creating a ratio that indicates a softening or tightening of the market.
Augustís index has increased by 1.7 points, which indicates a strengthening and tightening of Australiaís national labour market.

Commenting on the results, SEEK Joint CEO Paul Bassat said: ìThe reality is that, Western Australia and Queensland aside, Australian jobseekers are gradually experiencing increased competition for the job vacancies.

ìThe Western Australian labour market is very strong, which is indicated by the 17.2% rise recorded by SEEKís Employment Index in the year to August 2006. Business investment in the resource-rich states of Western Australia and Queensland has almost doubled in real terms in the last two financial years. Nearly 60% of all business investment nationally has occurred in these two states alone, and this is reflected in the strength of the job market is these states.ì

Professor Peter Sheehan, Director of the Centre for Strategic Economic Studies said:
ìThis monthís index suggests that the Australian labour market strengthened further in August after a subdued performance in July.î

ìThe Australian economy remains subject to many conflicting forces, ranging from tax cuts, interest rate increases, higher fuel prices and the resource boom. These forces are affecting different parts of the country in different ways, which is reflected in this monthís figures.î