Friday, November 20, 2009

Unemployment ain't going to get much worse - OECD

The Organisation for Economic Co-operation and Development says Australia's unemployment rate has "stabilised" and now won't reach either the peak of 8.5 per cent predicted in the May Budget or the much lower peak of 6.75 per cent forecast in this month's mid year Budget review.

The OECD's assessment, that the unemployment rate will touch just 6.3 per cent next year before turning down, has Australia performing better than any western country other than Norway and Switzerland.

It says unemployment in the United Kingdom will peak at 10 per cent and unemployment in the United States at 10.9 per cent...

Australia's unemployment rate is presently 5.8 per cent, close to the projected peak of 6.3 per cent in the forth quarter of 2010.

But detailed employment figures released yesterday indicate that the actual likelihood of joblessness varies enormously throughout the nation and within each city.

The NSW statewide unemployment rates of 6 per cent for men and 5.8 per cent for women bear little relationship the extraordinarily low rates of 1.8 and 2.9 per cent experienced on the northern beaches and 4.1 and 1.8 per cent in the eastern suburbs.

Sydney's worst underemployment is in what the Bureau of Statistics terms the central-western suburbs where it hits 9.5 and 10.1 per cent and in Canterbury-Bankstown where it reaches 9.7 and 7.9 per cent.

Separately-released wage data points to a growing disparity in earnings across the nation with pay packets increasing far faster in the mining states than in than NSW and Victoria.

Western Australia has cemented its lead as the highest wage state with an annual average of $67,900, topping the $63,300 paid in NSW.

Queensland has overtaken Victoria to move into third place at $61,500.

The OECD says Australia will be only of only three member economies to grow in 2009 and predicts that the Reserve Bank's cash rate will hit 5.5 per cent by mid next year, two complete percentage points higher than its present 3.5 per cent.

It says it supports a "gradual tightening of monetary policy" and and also the phased winding back of government stimulus programs.

In a rebuke to the Rudd government it says Australian authorities should "submit proposed projects more systematically to a rigorous and transparent cost-benefit analysis".

Published in today's SMH and Age

Related Posts

. Jobs are back from the abyss

. A hiring boom? That's what the figures suggest

. OECD on Australia's stimulus measures - the graph