Australia: Solid gains in full-time employment but it is narrowly based around a few sectors – Westpac

In view of Justin Smirk, Research Analyst at Westpac, household services remain the main driving force for Australian employment adding 246k employees in the last year.

Key Quotes

“Construction also made a solid contribution (+104k) while goods distribution was more modest (+65k).”

“Business services are now reducing employees (–105k in the year) as is public administration (–28k) while manufacturing was flat in the year.”

“For the household sector, education & health continue to make solid gains. However, the last six months have been a bit softer than the six months before with leisure & hospitality shedding employees while retail employment plateaued. Business services have had a contraction in the workforce due to professional & technical services retrenchments but the pace of retrenchment slowed for other business services while the finance sector made a small gain in the last six months.”

“The net balance of sectors expanding vs. sectors contracting for the last year was +1 highlighting narrow expansion. During 2015/2016, when employment growth peaked at 3%yr, the net balance was +4 and it held this level for a year.”

“Education & health care were the key drivers in NSW while retail and healthcare where the top two in Vic. Qld saw construction outpace education but in the end it was just pipped at the post by health care while in WA construction significantly outpaced them all. In SA health care was the dominate driver by a significant margin.”

“The pace of employment growth has slowed in the last six months and the reason net growth in total employment has remained positive is the offset from the moderation in employee shedding in those sectors that contracting.”