In the recent past we have seen job losses announced across industries. Some of the more significant announcements were from Qantas (500), ANZ (1000) and Toyota (350). Toyota has cited a high Australian dollar, which obviously impacts the cost of their manufacturing in Australia. We have heard cost of funding pressures from most banks in the media as some of the reasons they have to tighten costs to maintain profitability for shareholders.
So how bad is it? How long before we can expect an employee’s market? And is it really that bad when you view the Australian situation from a global perspective?
Suffice to say, it isn’t a very rosy time for job seekers. As small and big business feel the pain, it leads not only to a slow down in new hiring but also job losses. This is a double whammy, which further snowballs as experienced professionals are happy with lower salaries or rates. Some do this due to their perception of a bad market while others have no choice. Our government is not holding back either. Labor has announced their intention to cut back on government jobs as their razor gang figures out how to make more incisions to get the budget back to surplus.
Latest figures from ABS indicate that the unemployment rate is at 5.2 % (seasonaly adjusted). This is the same as the February number. However, breaking these figures down further, we can see that the sun is rising and shining high in the West when it comes to jobs. March figures state wise: NSW – 4.8%, VIC – 5.8%, QLD – 5.5%, SA – 5.2%, WA – 4.1%, TAS – 7%.
Let’s broaden our perspective a little for a complete picture. From a global perspective, we are not doing half bad in comparison with other developed economies. If you were to think about Europe, which country would you think to be the safest if you were to buy government bonds? France and Germany I suppose? Well get this, France has a 9.8% unemployment rate and Germany 7.4%. The US and UK are sitting at 8.4% and 8.2% respectively.
Now let’s take a look at the PIGS. Unemployment rates are as follows: Portugal 14%, Italy 9.3%, Greece 20.7% and Spain 22.85%. Are you thanking your stars already? However bad it is in Australia, it is actually good. Europe and US are dealing with high government debt which also impacts their cost of borrowing from the market. Greece and Spain are stuck in a vicious circle of raising taxes and cutting government spending to raise revenue to pay off their bills, in turn adversely impacting the economy and reducing their tax revenue.
So where do we stand? I believe that while we have seen better times in Australia, we should be thankful for our job market in its current state. I believe that solutions to problems in Europe pending, the market should stabilise and hopefully become an employees market in the next six months.
If you have a job and are reasonably satsified with it, don’t muck around too much. Be patient. If you are dissatisfied with your salary, wait for the right time to pop the question. Looking at predictions from economists in the media, they all indicate the raising of interest rates in the near future (after an initial cut or 2). This usually indicates an increase in economic activity expected over the period of next 12 to 18 months. This may be a good time to skill yourself up further. Do that certification you always were planning to do. Bear in mind that costs related to training directly related to your line of work is tax deductible. All in all, keep going dear reader with a level head and you will come out at the other end of the tunnel with a smile on your face.
(Overseas unemployment figures sourced from www.tradingeconomics.com)