Economy Strained by Sustained Resources Boom

The SEEK Employment Index

There is new evidence that Australia is in the grip of a worsening skills shortage as the growth in job vacancies continues amid falling job seeker activity.

The SEEK Employment Index, which measures the ratio of new job ads to job applications, increased sharply in August by 4.3%. The Index has recorded an annual growth rate of 13.5%, which is its highest since January 2006.

At a regional level, the Index was considerably higher in the resource rich states of Western Australia (9.8%) and Queensland (4.3%) but skills shortages were also severe in Victoria where the Index rose by 4.3%.

Job Advertisements
During August, the number of new jobs advertised increased by 0.8% nationally but labour demand was unevenly distributed in favour of South Australia, Queensland and Western Australia where the job ads increased by 4.4%, 3.7% and 3.2% respectively.

Job Applications
The major factor behind the tightening market was a reduction in job seeking activity. The number of applications for job advertisements posted with SEEK fell by 3.5% nationally and 6.6% in Western Australia.

Commenting on the results, SEEK Sales Director Joe Powell said that the sustained resources boom is imposing further strain on the rest of the economy.

ìThe initial impact of the resources boom was strong demand for labour in the Mining, Oil and Gas sector, and now that this demand is largely being met, skilled workers from the broader economy are the ones in short supply.

ìProfessionals such as healthcare workers, solicitors, insurance brokers, architects and educators provide important services to communities and individuals and there are simply not enough of them to go around.

ìMy advice to students who are planning to go to university next year is to seriously consider a career in professional services. With skills shortages already apparent in sectors such as health, IT, construction and law, graduates can expect strong employment opportunities in the years to comeî, he said.