Labour Shortages Ease in Resource-Rich States The SEEK Employment Index

The Australian labour market remained tight in July as strong demand for labour continued to be a feature across Australia.

The national SEEK Employment Index, the ratio of new job ads to job applications, increased by 0.3% in July (seasonally adjusted) to be 9.7% higher than 12 months ago. However, there were encouraging signs that labour shortages in the resource-rich states are easing with the index falling by 3.5% in Western Australia and 3.6% in Queensland. Victoria also experienced a modest fall of 1%.

Job Advertisements
Across Australia, new job advertisements posted surged by 6.1% (seasonally adjusted) in July, continuing the upward momentum observed since February. NSW was over-represented, recording a jump of 7.2% in new positions advertised as the market struggles to cope with a surge in job vacancies in the finance and superannuation industries. On a national basis, new job ads stand at 42% higher than the same time last year.

Job Applications
Job seeker activity continued to gain strength most notably in Queensland and Western Australia, where the ratio of applications per ad improved in both cases by 8.3% and 8.5% respectively. Job seekers in Victoria also joined in with a 5.6% increase in applications.

Commenting on the results, SEEK Sales Director Joe Powell said that the current job market conditions are creating long term challenges for employers in many industry sectors.

ìFundraising positions within the not-for-profit sector received the lowest number of job applications relative to other positions in July. Fundraising is challenging work that requires a specific skills set and not for profit organisations typically offer salaries that are 10-20% less than other public service positions.

ìIn this tight employment market, skilled candidates are faced with a substantial opportunity cost in pursuing community-focussed work. On the upside, those candidates who do apply are likely to have made an informed decision about how they would like to utilise their skills. In any situation, it is always preferable for employers to attract quality applications over quantityî, he said.

Professor Peter Sheehan of the Centre for Strategic Economic Studies said: ìSustained investor interest in superannuation and solid growth in the housing and commodities sectors were the key drivers of a strong economy in July. More importantly, the Australian labour force has responded well to accommodate the surge in job vacancies. Research by the Reserve Bank of Australia suggests that immigration has boosted labour supply in QLD, WA and Victoria . Tax reform and record household debt levels also appear to have encouraged further participation in the workforce by women, as evidenced in disaggregated SEEK dataî, he said.