Friday, December 10, 2010

NSW is sick no longer

NSW is now the engine of Australia's employment growth producing jobs at a far faster rate than any other state or territory and at twice the rate of Western Australia.

A surge in employment of 55,000 last month, all of the jobs full-time, took the took the total number of full-time jobs created this year to an all-time record of 300,000 - with one month left to go.

NSW created almost four in every ten of those jobs, piling on jobs in the past six months an annualised pace of 5.1 per cent, double Western Australia's 2.6 per cent.

Premier Kristina Keneally the NSW unemployment rate of 5.1 per cent was now below that of every state other than Western Australia.

"Since its peak the NSW unemployment rate has slid 1.7 percentage points, compared to a 0.5 nationally," she said.

The biggest drivers of jobs growth in NSW have been the education, health and aged care industries suggesting it is part of a general lift in the state's economy rather than deriving from mining...

Last week's generally weak national accounts showed state final demand growing in NSW as it fell back in almost everywhere else.

Nationally employment is growing at an annual rate of 3.7 per cent, double the rate of population growth and way above the 2.5 per cent forecast for this financial year in the November budget update.

"This is simply a stunning figure," said Treasurer Wayne Swan. "We have produced record job creation during a very difficult period."

"It shows we got the big economic calls right during the global recession and are continuing to get them right to support employment and to support people in work. There will be some people in a patchwork economy who are not doing as well as others, and particularly in the lead up to Christmas it’s always important to acknowledge those people, but these are figures are the envy of the rest of the world."

Full-time employment passed 8 million for the first time in November as total employment passed 11.4 million. A record 66 per cent of Australians either worked or made themselves available for work leaving the national unemployment rate above 5 per cent at 5.2.

HSBC economist Paul Bloxham said were it not for the jump in the number of people prepared to work in the past six months the unemployment rate would already by 4.5 per cent.

"It would be putting additional pressure on an apparently scarce resource, labour, and driving up its price, wages. Instead we have new supply coming on line with the market economy drawing in more warm bodies."

"As long as this continues, it's a Goldilocks story of Australia."

Nomura Securities economist Stephen Roberts said unemployment was set to fall quickly through 5 per cent, "a level that in the past has been consistent with accelerating wage pressure".

He expects the Reserve Bank to push up interest rates as soon as March.

ANZ economist Katie Dean said said the figures added to a growing risk that consumers "won't remain as restrained at the checkout".

The consensus forecasts released at this week's business economists forecasting conference have interest rates steady until mid next year and then increasing three times in quick succession before year's end.

New jobs this year, unemployment rate

NSW 132,000 5.1%
Victoria 93,000 5.5%
Queensland 71,000 5.5%
Western Australia 41,000 4.5%
South Australia 16,000 5.6%
Tasmania 3000 5.4%

ABS 6202.0 November, seasonally adjusted.

Published in today's SMH and Age

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