Friday, June 19, 2009

Which jobs are going?

White Collar ones

UNEMPLOYMENT among men in normally prosperous inner Melbourne suburbs is approaching double digits after the loss of thousands of professional positions in the finance sector.

A breakdown from the Bureau of Statistics shows that in suburbs including St Kilda, Prahran and Richmond, male unemployment hit 9 per cent in May, on a par with the 9.4 per cent recorded for men in Melbourne's outer west.

But unlike in the outer west, unemployment among men in the inner suburbs has shot up from levels as low as 2 per cent and 3 per cent in just a few months.

The jump reflects a collapse in full-time employment in Victoria's finance sector...

The Bureau says one in every ten full-time jobs in the finance sector have vanished over the last year - a loss of around 9000 full-time positions. Part-time employment has slipped 4000.

By contrast, employment in Victoria's retail sector has actually grown, surging 3500 between November and February at the time the government's first stimulus package was having its greatest impact.

The combined effect has been to even out unemployment rates across the state with most regions reporting rates between 5 and 8 per cent. As recently as late last year the rates ranged from 2 to 7 per cent.

At the same time the average number of hours worked per week has fallen to a new record low of 33 hours 42 minutes as full-time jobs have been replaced with part-time ones and hours cut.

Almost an entire hour of work per week has been lost since last May when the average totalled 34 hours 36 minutes.

"Employers are keeping people on but are trimming hours and pay to keep costs down," said CommSec economist Craig James. "They no doubt fear that if they cut good staff, they may not be able to get the same skilled workers in the future."

Commonwealth Securities no longer expects Australia's unemployment rate to reach the peak of 8.5 per cent forecast by the Federal Treasury.

"Employers are acting smarter," said Mr James. "They will be well placed to crank up activity when things pick up."

But he acknowledged that in the meantime the hours lost would hit purchasing power.

"Consumer spending will be restrained by the drop in take home pay. But the impact will be much milder than in the past when many more workers lost their jobs and purchasing power dried up."

2 comments:

carbonsink said...

My God, you quoted Craig James! Surely, if you quote Craig James you need to give equal time to Steve Keen? Has James ever given a bearish forecast on anything, ever?

The Bureau says one in every ten full-time jobs in the finance sector have vanished over the last year - a loss of around 9000 full-time positions. Part-time employment has slipped 4000.

By contrast, employment in Victoria's retail sector has actually grown, surging 3500 between November and February at the time the government's first stimulus package was having its greatest impact.


Q: When can a $300K job in finance be given equal weight to a $30K job in retail?
A: It does in the unemployment statistics!

What was the total income lost from the 9000 finance jobs, compared to the income gained from the 3500 retail jobs?

Pete (not Peter Martin) said...

Good post carbonsink.

Following some of your other posts it seems that you have a knack for seeing through the white-wash

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