The Employment Minister won't say
Unemployment has surged at a rate not seen since the 1990s recession, with teenagers bearing the brunt of the pain.
Australia's jobless rate rose from 3.9 per cent to 5.7 per cent in just over a year. The news was dramatically worse for 15 to 19-year-olds, the jobless rate climbing from 12 to 16 per cent.
Access Economics is this morning predicting an unemployment queue of 1 million by the end of next year. The queue swelled by 50,000 to 650,000 in the past month, and has jumped by 200,000 in the past year.
The figures — described by Deputy Prime Minister Julia Gillard as "dreadful" — came amid forecasts that construction will be the next sector to abandon workers.
Ms Gillard said Australians who were "obviously not the people who caused the global recession" were losing jobs through no fault of their own.
But when asked whether she would increase the unemployment benefit, presently just $32 a day, she gave no commitment.
Asked the times whether she herself could live on that amount the Deputy Prime Minister failed to reply and then closed the press conference...
The government has given a commitment to increase the pension in next month's budget, but not the unemployment benefit which is substantially lower.
"We want to do everything we can to make periods of unemployment as short as possible to assist people to get back into work, whereas we know that there are many elderly Australians who live on the pension for a very long period of time - decades - and so of course those pensions and benefits have always been viewed differently by government," Ms Gillard said.
The head of the Centre for Full Employment and Equity at the University of Newcastle Professor Bill Mitchell said Australia's labour market was now deteriorating faster than had the labour market in the United States.
"If things continue to get worse at this rate the unemployment rate would approach 14 per cent by the end of the year," he said. "That will not happen, but it puts into perspective the government's forecast of a 7 per cent by mid-2010, on which they based their $42 billion stimulus package."
"From her on things will get worse. We're near the beginning of the labour market adjustment," said ANZ economist Riki Polygenis.
"We are in recession. That debate is no longer material," said JP Morgan economist Stephen Walters. "First we saw firms cut contractors and their temporary staff. They've moved through the phase now of cutting hours worked and finally we have reached the point where they are reluctantly cutting staff."
NSW lost the most jobs in March, shedding 16000 workers and setting an Australian record for the biggest monthly jump in a state unemployment rate - from 5.9 to 6.9 per cent.
Victoria's unemployment rate edged up 0.2 points to the new national average of 5.7 per cent, and the former boom states of Western Australia and Queensland recorded sharp rises to 4.8 and 4.9 per cent.
"The job losses began months ago in the retail industry," said Access Economics director Chris Richardson. Now they have spread to finance, hitting NSW and to mining, hitting the far flung states. Manufacturing has been doing badly for some time so Victoria has been in a steady decline, but the reasons have changed. Manufacturing jobs were being lost as a result of the high exchange rate, now they are being lost because people have stopped buying cars and machinery."
Mr Richardson said the decline in manufacturing jobs would soon stop, "when the last textile clothing and footwear factory in Richmond closes," with the next jobs to be lost in commercial construction.
"Construction accounts for almost 1 in every 10 jobs, substantially more than it used to. When the current work finishes in six months time it'll shed jobs for 6 to 18 months," he said.
The true state of the labour market is worse than yesterday's figures suggest. Officially, 33600 jobs have been lost in the last two months, but full-time employment has collapsed by more than 90000 as employers have downsized hours in an effort to keep staff while cutting costs.
The shift has meant that the net job losses have been borne by men. Female employment has been steady since the start of the year.
Opposition Leader Malcolm Turnbull said the $23 billion handed out in stimulus payments had failed to have an effect.
"It was going to promote employment and create jobs," he said.
"Well it has created nothing except an enormous debt that we will spend many years, high taxes and high interest rates, paying off."
Deputy Prime Minister Gillard said without the payments the jobs figures would have been worse. She left open the possibility of further stimulus programs.