NSW Labour Market Overview

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1 NSW Labour Market Overview Presenter: Ivan Neville Branch Manager, Labour Market Research and Analysis 1

2 Slide 2 Current state of the NSW labour market Selected indicators over the year to October 2014 Employment - up by 35,800 (or 1.0 per cent) Unemployment - fell by 3,100 (or 1.4 per cent) Unemployment rate per cent, down by 0.1 percentage points and below the national rate (of 6.2 per cent) Participation rate per cent, down by 0.4 percentage points, and well below the national average (of 64.6 per cent) Vacancies up by 18.5 per cent over the year to September Source: ABS, Labour Force, Australia, October 2014 (Cat. No ), seasonally adjusted; Department of Employment, Vacancy Report, September 2014 Labour market conditions have been mixed in New South Wales over the last year. While employment has increased by 1.0 per cent over the year to October 2014, and the unemployment rate has fallen slightly, the participation rate has also fallen, by 0.4 percentage points to stand at just 62.9 per cent. 2

3 Slide 3 Internet vacancies and JSA job placements, NSW Source: Department of Employment Internet Vacancy Index, September 2014, three-month average of original estimates; Job Services Australia data, Department of Employment administrative data, three-month average of original counts. This graph shows that over the past five years the number of JSA Job Placements has closely followed the movements of the Department s Internet Vacancy Index. Both series trended downward from late 2010 to early Since March 2014, the number of online job advertisements and JSA Job Placements have increased. 3

4 Slide 4 Labour markets vary across Employment Regions Source: All data from ABS, Labour Force, Australia, Detailed Electronic Delivery, October 2014 (Cat. No ), 12-month average of original data, except for North Coast and Murray Riverina, which are based on Department of Employment, Small Area Labour Markets, June quarter Please note that ABS Labour Force estimates are unavailable for North Coast and Murray Riverina due to boundary issues. The unemployment rate for North Coast and Murray Riverina are instead based on Department of Employment, Small Area Labour Markets for the June quarter The Sydney East Metro region had the lowest unemployment rate of all Employment Regions (4.2 per cent) in October On the other hand, several regions had unemployment rates well above the State average (5.7 per cent). 4

5 Slide 5 Some areas of major disadvantage LGA Employment Region Unemployment rate June 2014 Fairfield Sydney South West 11.6% Auburn Sydney Greater West 9.3% Hawkesbury Sydney North and West 8.2% Liverpool Sydney South West 7.5% Eurobodalla Illawarra South Coast 11.5% Lithgow Central West 8.8% Cessnock Hunter 8.3% Shoalhaven Illawarra South Coast 7.2% Lismore North Coast 7.3% NSW* 5.7% * NSW unemployment rate is seasonally adjusted October 2014 Source: Department of Employment, Small Area Labour Markets, June quarter 2014; ABS, Labour Force, Australia, October 2014 (cat. no ), seasonally adjusted A number of regions in New South Wales face persistent labour market disadvantage. For example, the Local Government Areas (LGAs) of Fairfield and Eurobodalla each have unemployment rates over 10 per cent. 5

6 Slide 6 Trends in NSW: Shift towards part-time jobs Source: ABS, Labour Force, Australia, October 2014 (Cat. no ), trend Over the last 20 years, both full-time and part-time employment in NSW has increased by about 470,000. This represents a 77 per cent increase in part-time employment, compared with a 23 per cent increase in full-time employment. In October 1994, part-time employment accounted for 23 per cent of total employment; it now accounts for 30 per cent. A number of factors may have contributed to this, including: Increasing female participation (up by 5.0 percentage points over the last 20 years) Decline in traditional, male-dominated industries such as Manufacturing, which tend to be full-time 6

7 Slide 7 Trends in NSW: Shift towards Services Sector Source: ABS, Labour Force, Australia, Detailed, Quarterly, August 2014, four-quarter averages of original data The last 20 years has seen Manufacturing s share of employment fall from 14 per cent to 8 per cent in August 2014, while employment in Health Care and Social Assistance (12 per cent of employment) and Professional, Scientific and Technical Services (8 per cent) has increased substantially. 7

8 Slide 8 Trends in NSW: Jobs growth mostly in higher/medium skilled jobs Source: ABS, Labour Force, Australia, Detailed, Quarterly, August 2014, four-quarter averages of original data Employment growth has been considerably stronger for higher and medium-skilled occupations (up by 433,000) than for lower-skilled occupations (up by 53,000). The higher and medium skilled occupations refer to those in the Managers, Professionals, Technicians and Trades Workers and Community and Personal Service Workers occupation groups. The lower skilled occupations refer to those in the Clerical and Administrative Workers, Sales Workers, Machinery Operators and Drivers and Labourers occupation groups. 8

9 Slide 9 Increasing applicants for lower skilled vacancies Source: Department of Employment, Survey of Employers Recruitment Experiences, data to June 2014 This slide shows that competition for lower skilled vacancies, advertised using the internet or newspaper, has increased in recent years. In 2014, employers reported an average of 19 applicants per vacancy. 9

10 Slide 10 High youth unemployment across NSW Source: ABS, Labour Force, Australia, Detailed Electronic Delivery, October 2014 (Cat. No ), 12-month averages of original data The youth unemployment rate in New South Wales has increased over the last year to stand at 12.2 per cent in October Regional youth unemployment rates remain high across New South Wales, with a number of Employment Regions recording unemployment rates above the State average. 10

11 Slide 11 Long-term unemployment on the rise Source: ABS, Labour Force, Australia, Detailed Electronic Delivery, October 2014 (Cat. No ), 12-month averages of original data Long-term unemployment in NSW increased by 7,800 over the last year, with over half (4,000) being youth (aged years). 11

12 Slide 12 High levels of disengagement in many regions Source: ABS, Census of Population and Housing, 2011 Data from the 2011 Census suggest that high levels of labour market disengagement (proportion of the population neither working nor studying) among year olds were present in several New South Wales Employment Regions, including Mid North Coast, North Coast and New England and North West. 12

13 Slide 13 Improving the employment prospects of young Australians Source: Department of Employment, Survey of Employers Recruitment Experiences, various regions, October 2013 to April 2014 The results in this chart are based on 2163 responding employers who were surveyed between October 2013 and April 2014 in the Gladstone Employment Service Area (ESA), Bundaberg ESA, Central Victoria region, Port Augusta Whyalla Port Pirie region, Sydney West-Blue Mountains region, Illawarra region, Caboolture-Sunshine Coast region and Tasmania (excluding Hobart Statistical District). Some employers provided more than one response to the question From your experience, what do you think could be done to improve young people s chances of getting a job?. Over half of employers surveyed (57 per cent) suggested that improving employability and labour market engagement would improve youth labour market outcomes, most particularly: Attitude/motivation 13

14 Communication Job seeker expectations Presentation A substantial proportion of employers (30 per cent) believed that experience, further education or training would improve youth labour market outcomes, in particular: Work experience Education Traineeships 14

15 Slide 14 Many employers have high expectations for lower skilled jobs Source: Department of Employment, Survey of Employers Recruitment Experiences, All regions surveyed in the 12 months to June 2014 Almost one half (48 per cent) of employers recruiting for lower skilled jobs did not interview applicants because they had insufficient experience, while one in five (21 per cent) said that applicants were not interviewed due to a poor application. 15

16 Slide 15 Employability skills are essential Only 2 per cent of employers hired staff who lacked employability skills Essential employability skills include: o Communication o Basic customer service skills o People skills o Friendliness o Hardworking o Trustworthy Source: Department of Employment, Survey of Employers Recruitment Experiences, Sydney July 2014 and combined results for the year to March 2014 Recent survey results suggest that employers are reluctant to hire staff whom they feel lack certain employability skills (such as communication skills, basic customer services skills and people skills). 16

17 Slide 16 JSAs and job seekers both need to tap into available opportunities Source: Department of Employment, Survey of Employers Recruitment Experiences, All regions 12 months to June 2014; ABS, Job Search Experience, July 2013 About 1 in 20 employers used a JSA for their most recent recruitment, most commonly for lower skilled occupations. There are many vacancies, including those recruited for using informal methods only, for which JSAs and job seekers could tap into. 17

18 Slide 17 Employer use of Job Services Australia Providers Source: Department of Employment, Survey of Employers Recruitment Experiences, All regions surveyed in the 12 months to June 2014 The most common reasons employers gave as to why they used a Job Services Australia provider were satisfied with past services (44 per cent of employers), positive relationship with recruitment agency (23 per cent) and directly approached by agency (18 per cent). Of those businesses that used a JSA provider, 90 per cent were satisfied with the service they received. For those that were dissatisfied, the main reasons given were that the applicants skills did not match the job or the JSA lacked suitable applications. 18

19 Slide 18 Employment outlook Source: Department of Employment, Industry, Occupation and Regional Projections to November 2018 The Department s employment projections suggest that employment growth over the five years to 2018 will be greatest for higher skilled occupations. In terms of industry, Health Care and Social Assistance and Education and Training are expected to make up 31 per cent and 17 per cent of total growth respectively. The greatest employment growth is projected to be in Greater Sydney, with the Central West and Hunter Employment Regions also projected to experience relatively high employment growth. 19

20 Slide 19 Further information Department of Employment Labour Market Information Portal Department of Employment Skill Shortages Department of Employment Regional Reports Department of Employment Australian Jobs Job Outlook More information on labour market conditions and other research on small areas can be found on these web sites. Thank you. 20

21 Slide 20 Contact information If you have any questions about the presentation please contact the Recruitment Analysis and Employer Surveys sections on or 21

22 Slide 21 Department logo 22

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