As the Australian economy ended 2018, it became clear that the Aussie jobs market has begun to lose momentum. This is perhaps best illustrated by the ANZ job ads series, which has clearly begun to rollover:
Now economists are predicting that Australia’s falling housing market and the banking royal commission could weigh heavily on jobs in the construction, retail and FIRE (finance, insurance and real estate) sector. From The ABC:
The Sunsuper Australian Job Index measures and tracks digital job advertisements across more than 4,000 sources.
It said financial and insurance services was the weakest performing industry of 2018, with demand falling 9.6 per cent year-on-year….
Sunsuper’s chief economist, Brian Parker, said the fallout from the royal commission would continue to impact employment demand and career opportunities in the sector…
APAC economist Callam Pickering predicts employment prospects in the finance sector will be dim this year…
“The banks are likely to do fewer mortgage loans and that will flow through to [lower] demand for new workers”…
Mr Pickering said a weaker property market will also hit other sectors including construction, real estate and retail…
He said residential construction had already started contracting and real estate employment may decline as sales and commissions drop.
Retailers were already facing intense competition from the likes of Amazon.
“Soft wage growth for most households isn’t doing the sector any favours,” he said…
“A drop in household wealth is the last thing retailers need right now.”
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The “good” news is that the FIRE sector only accounts for around 5% of Australian jobs. Not so the construction and real estate industries, which together account for nearly 20% of Australian employment:
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness.
Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.
