Further Strain on a Tight Employment Market

The SEEK Employment Index
There was a pronounced tightening of the employment market during May, due to a resurgence in demand for labour in the south-eastern states coupled with a fall in job applications. On a national basis, the SEEK Employment index jumped 4.6% (seasonally adjusted) to be 12.5% higher than 12 months ago.

Job Advertisements
New job ads posted in May maintained the upward momentum of the past three months, with a further increase of 3.2% (seasonally adjusted). Across the States, the strongest contributors to new job growth were South Australia (7.9%), Queensland (4.2%) and Western Australia (4.1%). Moderate employment market growth was experienced in Victoria (1.9%) and NSW (1.7%).

Job Applications
Following a jump in job seeking activity in April, the number of job applications posted through SEEK fell by 3.6% in May (seasonally adjusted). Job application numbers remain just 5.5% higher than they were one year ago, which when compared to a corresponding 35.8% increase in news jobs advertised over the same period highlights the extent of the current market imbalance.

Commenting on the results, SEEK Sales Director Joe Powell said that the impact of the record investment earmarked in the Federal Budget for Defence this year was already visible in the May jobs data.

ìAir Force and Navy positions filled two of the top five candidate-short positions in May, suggesting that the Governmentís recruitment drive to bolster the armed forces has now moved up a gear.

ìSouth Australian recruiters have also had their hands full last month with a rush of new positions being advertised. A 7.9% increase in new jobs was more than double the national average, and many employers would have experienced a sudden increase in difficulty filling vacant positions.

ìThe banking and finance sector is particularly strong, with candidates experienced in investment banking, corporate finance, superannuation and insurance claims all in strong demand.

ìOur advice to employers is to allow a longer timeframe for recruitment and where possible, create opportunities for existing staff to progress their careers by taking on more senior roles, rather than relying solely on new recruitsî, he said.

Professor Peter Sheehan, Director of the Centre for Strategic Economic Studies said: ìGiven the lower than expected increase in the CPI in March and forthcoming tax cuts the economy seems to be driven by consumption and the housing sector. Notwithstanding the 30 year-low employment rate, Australiaís continuing resources boom and the expanding credit by households and businesses raise the risks for asset price inflation and a monetary policy response to imbalancesî, he said.