Home' Employment Forecast : April 2010 Contents 21
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Manufacturing continues to struggle, as it does in just about all developed countries. Jobs fell again in February 10, but the pace of decline is
slowing. Jobs have fallen in just about all categories of manufacturing. Food manufacturing has fallen 2.4%. Due to the slowing Construction
Sector, wood product manufacturing has lost jobs (-8.8%), and pulp and paper has fallen as well (-14.1%) reflecting a slowdown in demand from
business for paper products and heightened concerns about the environment. Basic chemical manufacturing has shed jobs as well. Transport
equipment manufacturing is also lower (-10%). Furniture manufacturing, too, is lower (-6.9%). The large car makers have also had a tough time
with jobs falling. However, with new car sales rising again --- up 17% in February 10 compared with the poor 2009 -- the outlook is better in that
sub-sector. Rental hire car companies were the main driver of the car sales growth, although private new car buyers were up 9.3%.
One of the few bright spots is in the machinery and equipment manufacturing, where jobs grew 7.6% and in fact, jobs in this sub-sector have
grown over the last year. For the first time in years, textile clothing and footwear jobs have been added (+2.8%), but jobs in this sector have
fallen by a massive 55% over the last 10 years.
At the State level, NSW is the only mainland State to be growing jobs. However, this has been driven by strong growth in part time jobs. In
Victoria, which is still the manufacturing capital of Australia, full time jobs are falling and so are part time jobs as business seeks to cut costs.
Queensland as well is losing full time positions. SA has a strong base in motor vehicle related manufacturing and this has really borne the brunt
of the decline in manufacturing in that State. Full time jobs are falling at over 10%. WA has a relatively small manufacturing base and this is
losing both full time and part time jobs.
Although business confidence has improved in the Manufacturing Sector --- it is up from -37.8 in the December 08 quarter to 16.9 by December
09 --- considerable headwinds remain for this industry. The exchange rate is expected to stay high, making our manufactured exports more
expensive and still cheap Chinese imports will provide plenty of competition. Having said that, the EMDA model is forecasting that the rate of
decline will slow and that by November 10 a very modest level of jobs growth can be expected. This will largely be driven by manufacturing that
supports the mining and related industries as well as housing construction and business related (ie, paper) manufacturing.
This has suffered more than most and only a modest improvement is expected
Private Business Cap Ex
Machinery and Equipment
Source: ABS/EMDA Model 2010
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