Friday, March 11, 2011

Who'd have thought? After everything, NSW leads the way

Building jobs
NSW +22,000 (4.8%)

Holding firm
Victoria (5.0%)
South Australia (5.8%)
Tasmania (5.6%)

Losing jobs
Queensland - 22,000 (5.6%)
Western Australia - 11,000 (4.2)

Seasonally adjusted, rounded to nearest 1000 (Unemployment rate)
ABS 6202.0 February 2011

A surging NSW jobs market has presented Kristina Keneally with a pre-election gift - three months of the best unemployment figures since Morris Iemma was premier.

The February unemployment rate of 4.8 per cent follows 4.9 per cent in January and 4.6 per cent in December, all below 5 per cent for the first time since mid-2008.

More than 22,000 new jobs were created in February alone. Over the past three months NSW has created 28,000 new jobs, double the 14,000 created in Victoria and streets ahead of Western Australia and Queensland which have lost 13,000 and 23,000 jobs in the same period.

"We are a two-speed nation, but not in the way you would think given the focus on the mining boom," said Westpac economist Justin Smirk...

"NSW isn't being boosted in a way other states are not. We are benefiting from the mining boom having about the Australian average of mining income, but without the contracting property markets of Queensland and Western Australia."

"We create jobs providing business services to mining companies in the rest of Australia and
are not as tourist dependent as Queensland, so we are not suffering as much from the high dollar."

The February employment figures show Queensland to be very much a special case, losing 22,000 jobs in the month, enough to offset the NSW gain.

Nationally full-time employment jumped 47,600 offset by a fall in part-time employment of 57,700, almost all of it in the two flood affected states of Queensland and Victoria. Total hours worked rose as the gain in full-time hours worked more than offset the slide in part-time hours.

"There is nothing in this data that disrupts the strong medium term outlook for Australia," said ANZ economist Julie Toth.

"February's news was always going to be affected by the floods. That disruption will be temporary, the medium term outlook is solid."

The national unemployment rate held steady at 5 per cent. Excluding Queensland it was 4.9 per cent.

The dark side of what is now an extraordinary jump of 302,000 new jobs in the past year is that in net terms none of them have gone to teenagers. There are 300 fewer teenagers employed than there were 12 months ago.

"There is nothing good that you can say about youth employment going backwards," said Bill Mitchell of the Centre of Full Employment at the University of Newcastle. "An economy that excludes its active teenagers from any employment growth at all is not one using its capacity to potential."

"The longer-run consequences will be very damaging."

Published in today's Age

Bill Mitchell

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