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From: AAP January 11, 2010 11:40AM

THE number of jobs advertised in major newspapers and online rose by 6 per cent in December, the strongest monthly growth in two-and-a-half years.

Overall job ads averaged 149,063 a week, with newspaper job ads rising by 11.6 per cent and internet job ads increasing by 5.6 per cent, an ANZ survey shows.

The rise in December follows a 5.2 per cent increase the month before and it was the strongest monthly growth since May 2007.

ANZ acting chief economist Warren Hogan said total job advertisements have recovered from the recent low in July 2009 as they continue to improve each month.

“This is already translating into employment growth and helping to keep the unemployment rate relatively stable, despite accelerating population and labour force growth,” Mr Hogan said.

“This sustained improvement in job advertisements and actual employment has come relatively early in this economic recovery cycle, indicating the mildness of the downturn Australia has experienced over the past 18 months.”

The report comes ahead of labour force figures for December from the Australian Bureau of Statistics on Thursday.

Financial markets expect the number of new jobs created increased by 10,000 in December, and the unemployment rate rose 0.1 percentage points in December.

The number of jobs advertised in major metropolitan newspapers averaged 10,631 a week, and were 4.8 per cent higher than 12 months ago, the ANZ survey says.

Online job ads averaged 138,432 a week, but they were 24.1 per cent lower than in December 2008.

Mr Hogan forecasts the job market to continue to improve in the coming months.

“In the near term, the forward indicators appear positive for some solid employment growth in December and over the summer months, although probably at a slower pace than seen in the past three months,” Mr Hogan said.

“The ANZ (and other) job ads surveys are improving rapidly, retail sales turnover grew strongly in November (retail trade is currently Australia’s second largest employing sector, behind health services), business investment and construction are regrouping, and the AiGs three industry surveys (manufacturing, services and construction) all indicated net expansion of employment in December.”

ANZ expects the unemployment rate to peak at around six per cent by mid-2010.

From: AAP January 10, 2010 4:41AM

Car production in Australia has plunged to its lowest level since 1957.

CAR production in Australia has plunged to its lowest level since 1957, with manufacturers hit by the global economic slump and the high Australian dollar.

Despite strong local car sales, helped by the federal government’s business tax breaks, exports to markets such as the Middle East and the United States have all but collapsed, Fairfax newspapers say.

The industry is set to be further buffeted by a January 1 tariff cut that has lowered the price of imported models relative to locally produced cars.

Figures from the Federal Chamber of Automotive Industries show Australia produced just 225,713 vehicles last year, almost 100,000 fewer than in 2008 and 55 per cent of the output in 2004.

The chamber’s chief executive, Andrew McKellar, told Fairfax a “crucial factor” this year will be the speed of recovery in export markets, warning that the high dollar poses a serious long-term threat to the competitiveness of the industry.

Separate figures from the Bureau of Statistics confirmed the dramatic collapse in exports.

The export slump will leave Australia’s car industry even more heavily dependent on taxpayer-funded assistance, which is mainly provided through the Government’s $6.2 billion car industry plan.

Industry Minister Kim Carr said production had been running at half its usual pace, although local producers had fared better than elsewhere in the world, given no major companies had gone broke.

Ross Gittins
July 13, 2009

Another week, another round of not-so-terrible indicators about the state of the economy. It’s getting easier to believe and harder to doubt this recession will be a lot milder than we’re used to.

If the recession does prove to be less severe than advertised, both sides of politics will need to review their plans.

Last week brought the remarkable news that the Westpac-Melbourne Institute index of consumer sentiment rose by 23 per cent over the past two months to its highest level since December 2007, with optimists now well outnumbering pessimists.

The number of new housing loans in May was at a 16-month high. And the labour force figures for June showed unemployment continuing to rise quite slowly.

Put that together with recent increases in retail sales, car sales and home prices and you’ve got a picture of an economy travelling quite a bit more strongly than envisaged as recently as the budget in May. The global recession is every bit as severe as we were led to expect, but it seems it hasn’t dragged our economy down nearly as much we feared.

Whereas in early May the Reserve Bank was forecasting that real gross domestic product would contract by 1 per cent over calendar 2009, when we see its revised forecast next month it’s likely to be for growth of about 0.5 per cent, maybe more.

If our prospects really are that much brighter, two main factors account for it. First, continued demand from China has limited the expected decline in our export income. The volume of exports actually rose over the six months to March and seems to have held up since then.

Much rides on the success with which the Chinese authorities can switch from export-led to domestic-led growth, whether from consumption or infrastructure investment. The beauty from our perspective is that wherever they get their growth from, they’ll need lots of steel and energy – the very commodities we supply.

The second factor is the continued strength of consumption spending, explained not just by the cash splash and the huge cut in mortgage interest rates, but by the way this has affected people’s sentiment about the state of their own finances and the outlook for the economy.

It’s always possible, of course, that all we’re experiencing is an Indian summer. The global financial crisis may have more shocks to deliver, or it could be that consumer and business confidence will wilt under the inexorable rise in unemployment yet to come.

But that fear is starting to wear thin. Whereas the budget forecast was for the unemployment rate to reach a peak of 8.5 per cent sometime in 2010-11, the new expectation is that it may not quite reach 7.5 per cent, and will reach its peak a fair bit earlier.

If that expectation comes to pass then, with the rate now at 5.8 per cent, we’ve already come a little more than half the distance from the trough of 3.9 per cent in February last year.

If further evidence confirms the emerging picture of a relatively mild recession, this has wide ramifications.

For a start, it reduces the likelihood of any further cuts in the official interest rate – barring any seriously damaging developments – and brings forward the day when the Reserve will want to start reeling in its monetary stimulus.

Something that’s starting to worry it is the untimely recovery in the housing market. Although it would be desirable to see house prices gently falling back from the excessive levels they have reached, nationwide they’ve actually risen by 4 per cent in four months. House prices are rising in all capital cities bar Perth, auction clearance rates are up to about 80 per cent in Melbourne and, nationwide, prices are rising at the bottom, the middle and the top of the range.

The thought that the lowest mortgage interest rates in 31 years might be starting a new house price bubble is one that central bankers find unsettling. Should these signs continue, it will make them anxious to start the process of getting rates back to more normal levels.

Australia’s interest rates are already high in comparison with those in the major economies. This, combined with our brighter prospects relative to the others, probably explains why our dollar is back up to around (an uncomfortable) US 80c.

If our economy enters recovery while the majors continue to wallow, the gap between our rates and theirs will widen further, probably putting further upward pressure on the dollar. Another consequence of a milder-than forecast recession and earlier-than-expected return to growth is smaller budget deficits than forecast. Already it’s clear the deficit for the financial year just ended will fall short of the $32 billion expected at budget-time.

And if deficits prove smaller than expected, then government borrowing and debt levels will be lower than expected.

If so, this could prove embarrassing for Malcolm Turnbull, whose Debt Truck asserts that Labor’s “debt bombshell” is $315 billion.

Though Turnbull wants the punters to believe this is an accomplished fact, it’s actually what the gross federal public debt (naughty, naughty) was projected to be in five years time.

But if this recession does prove a lot milder than feared, this could also create political problems for Kevin Rudd. Because the punters never think of the “counter-factual” (what would have happened had you not done what you did), a mild recession could leave some people wondering – and an opportunist Opposition questioning – why you ever thought it necessary to spend all the money you did. Rudd’s reply, presumably, would be to claim it was only the Government’s actions that protected us from the global conflagration.

And there’s another downside Rudd needs to ponder. The earlier the economy begins recovering, the sooner the pressure will begin for him to start cutting spending to reel in the budgetary stimulus.

In theory, this shouldn’t be much of a problem: first, because what the budget’s “automatic stabilisers” caused they should eventually take away and, second, because all the discretionary additions to government spending officially labelled as “stimulus” are strictly temporary rather than ongoing.

In practice, however, with every month Rudd stays in office he’s solving this problem or that by making permanent additions to government spending. It’s facing up to the budgetary bottom-line implications of this largesse that will make his life uncomfortable.

It’s beginning to look as though the start of the process of reeling in the budgetary and monetary stimulus may coincide with the election due in the second half of next year.

For the Reserve to be raising rates in two election campaigns in a row at least would demonstrate its political even-handedness. But perhaps Rudd will read the signs better than his predecessors.

Ross Gittins is the Herald’s Economics Editor.

Peter Martin Economics Correspondent
July 7, 2009

THE Reserve Bank board is likely to hold its nerve and keep interest rates steady despite new evidence pointing to a hiring freeze and jump in unemployment.

Newspaper and internet job advertisments slipped a further 6.7 per cent in June to roughly half its level of a year ago and the lowest level since the take-up of internet advertising, according to the ANZ employment survey.

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Newspaper job advertisements in the Herald and the Daily Telegraph slipped 1.2 per cent in June to be down 48 per cent on a year before.

An ANZ economist, Warren Hogan, said that while employers had stopped hiring they were still “hoarding labour” and were yet to seriously shed staff.

“For the moment population growth is driving the unemployment rate up rather than widespread job losses,” he said. “The key to the future is whether … labour shedding picks up.”

Forecasters surveyed by Reuters expect a further 25,000 jobs to be lost when the official figures are released on Thursday, which combined with population growth would push up the unemployment rate from 5.7 per cent to 5.9 per cent. Most expect an unemployment rate of 7 per cent by December.

The Reserve Bank board is likely be unmoved by the outlook for Australian unemployment when it holds its monthly meeting in Sydney this morning, focusing instead on improving prospects for China, which is now Australia’s biggest export customer.

Since the bank’s governor, Glenn Stevens, declared China’s recovery to be “real” at a business function in May, Reserve Bank staff have firmed in their view that increased demand by China for Australian raw materials reflected an economic rebound rather than speculative stockpiling.

Australia’s exports to China have hit record highs in each of the past three months, eclipsing exports to Japan.

The Reserve Bank believes that while there might be an element of speculation to these purchases, they are primarily driven by real and probably sustainable demand flowing from the Chinese Government’s stimulus program.

The bank expects the International Monetary Fund to revise up its outlook for China when it reports tomorrow.

At home the Reserve Bank is buoyed by confidence surveys suggesting a return to optimism among businesses and consumers and by some of the results from its business liaison program.

A Treasury report finds conditions in the mining sector better than had been expected and Australia’s retail and construction sectors “buoyant”.

However it finds manufacturing conditions mixed, with “those operating in the food and beverage sector or supplying lower value retailers generally enjoying relatively benign conditions” and “those engaged in the production of consumer durables and business plant and equipment less sanguine”.

But it says even among heavy manufacturers “several contacts believed the bottom of the current economic cycle may have been reached”.

Financial markets expect the Reserve to keep rates on hold today for the third consecutive month, but expect at least one further cut by the end of the year.

By George Megalogenis
The Australian
July 06, 2009 12:00am

AUSTRALIAN-BORN workers have been shielded from the worst of the global recession, as employers have mainly restricted the economy-wide job losses to migrant workers.

Although unemployment is rising across the board as opportunities vanish, there is a clear divide emerging between the treatment of local and overseas-born workers, The Australian reports.

Australian-born workers dropped 22,000 full-time jobs in the 12 months to May but picked up an extra 74,500 part-time jobs for a net gain of 52,500 positions.

By contrast, migrant workers lost 37,100 full-time jobs, offset by 21,600 extra part-time jobs for a net loss of 15,500.

The detailed research by The Australian suggests employers have been laying off workers on a last-on, first-off basis.

This puts the migrants who claimed the majority of the jobs available at the top of the boom, when the economy faced acute skills shortages, in the employment firing line now.

In the early 1990s recession, non-English speakers were the most disadvantaged as blue-collar manufacturing jobs disappeared.

This time, New Zealand-born workers are the most likely to be retrenched, with 11,000 full-time jobs and a further 9800 part-time jobs shed in the 12 months to May, for a net loss of 20,800.

The Indian-born are faring much better, with 19,500 more full-time and 18,500 more part-time jobs.

This is a sign that shortages remain across significant pockets of the economy as the Indian migrants tend to have higher skills on average.

On the other hand, northeast-and southeast-Asian-born workers have lost their jobs in roughly the same numbers as the New Zealanders.

Overall, English-speaking migrants are down 11,600 jobs in net terms, while non-English speaking migrants have lost 4000 jobs.

Australia has defied the global recession som far, with unemployment at 5.7 per cent. More tellingly, the wider economy has yet to move into the red zone where a larger number of jobs are being lost than are created.,27753,25738596-462,00.html?referrer=email&source=eDM_newspulse

July 3, 2009 – 6:59AM

The unemployment rate in the 16 euro countries climbed to a 10-year high of 9.5 per cent in May as companies cut jobs to survive Europe’s worst post-war recession, according to EU data on Thursday.

Some 273,000 jobs were lost across the eurozone in May as the unemployment rate rose to the highest point since May 1999, the European Union’s Eurostat data agency estimated.

“Deep and extended economic contraction, depressed business confidence and deteriorating profitability is pushing unemployment up sharply across the eurozone,” said economist Howard Archer at consultants IHS Global Insight.

Although activity in the recession-hit European economy is beginning to pick up, many companies are still shedding workers to adjust to slack demand for their goods and services in Europe and abroad.

The May eurozone unemployment rate was up from 9.3 per cent in April and 7.4 per cent in May 2008.

Meanwhile, in the 27-nation EU the unemployment rate rose in May to 8.9 per cent, hitting the highest level since June 2005 as 385,000 jobs were lost.

Eurostat estimated that in total 21.5 million people were unemployed across the EU in May, of which 15.0 million were in the euro area.

Looking ahead, Jennifer McKeown at research outfit Capital Economics said: “Survey measures of hiring intentions point to a further easing in the rate of job cuts to come.

“But given that labour market developments tend to lag behind those in the wider economy, unemployment almost certainly has considerably further to rise. We expect the rate to reach about 12 per cent next year,” she added.

Likewise, Archer predicted that economic activity would remain too fragile to begin generating more jobs than were being cut “until well into 2010,” with negative implications for the economy.

“Sharply higher, rising unemployment will weigh down on eurozone consumer spending, especially as it will be liable to lead to slowing wage growth,” he said.

A major headache for European politicians for decades, unemployment had been steadily falling ahead of the current downturn, reaching a record low of 7.2 per cent in March 2008.

However, with the rapid deterioration in the economy, the unemployment rate has steadily climbed higher since then.

Anne Davies
July 3, 2009 – 6:42AM

President Barack Obama described America’s unemployment rate as ”sobering news” after new figures showed it had reached a 26-year high, and that another 467,000 people lost their jobs during June – a big jump on May, which had brought hopes of a turnaround.

The nation’s unemployment rate rose to 9.5 per cent from 9.4 per cent, the labor Department said, and most economists now believe it will top 10 per cent before the end of the year. Some 14.7 million people are now looking for work.

But perhaps more alarming is that the June numbers show that employers are continuing to jettison their workers at an alarming rate.

US job loss numbers rise in June
467,000 American jobs were lost in June, according to the Labor Department, far more than expected.
Job losses peaked in January and had declined every month until this latest figure.

Economists had been forecasting a more modest figure of 350,000 jobs shed for June, in line with the May job losses.

Speaking from the Rose Garden at the White House after a meeting with energy executives, Mr Obama said the latest unemployment figures were “sobering news” and that they showed the urgency of investing in new industries such as clean energy to generate new jobs that can’t be sent overseas.

”We have to unleash the great generative powers of the American economy,” he said, adding that the executives he had talked to in the industry were looking to double and triple their companies thanks to the policies to drive investment in renewable energy.

There have also been other worrying signs that the US economy is still in terrible shape. The consumer confidence index fell after several months of improvement as Americans worried about a protracted downturn and rising unemployment. The index fell to 49.3 from 54.8 in May. House prices are also continuing to fall.

Of those with jobs, wages were flat and many employees had their hours cut last month.

There was, however, a slither of good news on Wednesday when the car makers reported that sales were down on May but the decline was less steep. Year-over-year declines last month slowed for four of the six major car makers, with Ford Motor Co – the only major US automaker not in bankruptcy – reporting the smallest drop in a year at 10.7 per cent when compared with June of 2008.

July 1, 2009 – 9:49AM

Activity in the manufacturing sector continued to decline in June, although the pace of easing slowed, a survey showed.

The Australian Industry Group/PricewaterhouseCoopers Performance of Manufacturing Index rose by 0.9 index points in June to 38.4 points, seasonally adjusted.

June marked the 13th consecutive month that the index was below the 50-point level, indicating contraction in activity.

AiGroup chief executive Heather Ridout said on Wednesday some sectors had benefited from the federal government’s fiscal stimulus packages, lower interest rates and a lift in consumer confidence during June.

“While the slowing in declines in manufacturing inventories, employment and deliveries is encouraging, the continued weakness in new orders and production raises doubts as to whether this trend will be sustained,” Ms Ridout said in a statement.

“There will need to be an improvement across all sectors in the months ahead, particularly automotive, transport and construction industries which reported weakness and impeded manufacturing production in June.”

In the survey of more than 500 companies, four of the 12 sectors – machinery and equipment, textiles, basic metal products and fabricated metal products – recorded easing in the decline of activity.

Two sectors, food and beverages, and clothing and footwear, reported increases in activity during June, reflecting the effects of the federal government’s second stimulus package and generational-low interest rates, the report said.

New orders remained weak, while employment, deliveries and inventories declined at a slower rate.

PricewaterhouseCoopers global leader of industrial manufacturing, Graeme Billings, said weak markets were placing pressure on the ability of firms to manage costs and maintain profit levels.

“The weakness in manufacturers’ markets illustrated by continued declines in new orders puts further pressure on profit margins as prices continue to fall at the same time as input prices and wages growth remain stable,” Mr Billings said.

“This only re-emphasises the need for firms to continue to focus on ensuring cash flow through such strategies as reducing unit costs through inventory and supply chain management and managing debtors and creditors effectively,” Mr Billings said.

By Caitlin O’Toole
June 16, 2009 09:12am

A YEAR ago, accounting and mining engineering students would be fielding two or three job offers halfway through their final year.

Now, they can’t afford to be choosy, and count themselves lucky to get a single offer.

Graduate Careers Australia research manager Bruce Guthrie said the economic uncertainty takes the shine off industries hit hard by the downturn, like formerly ‘hot jobs’ in mining and finance.

“A lot of employers have just been holding back a little bit, waiting to get some firm idea about what the rest of the year will bring,” said Mr Guthrie.

“Some employers decided maybe to be a little more prudent and either decided to delay hiring, or pay people and say ‘sorry we’ll withdraw the offer’.”

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Almost 70 per cent of graduates expect it will be hard to get a position because of the economy, according to a CareerOne survey. And almost half of grads aren’t working in the field they studied.

As architecture and building, accounting, engineering and business graduate programs mirror the economy, the less glamorous careers will hold up, predicts Mr Guthrie.

“Commonly those are areas in the teaching, health sciences areas, where demand for employees isn’t governed by the economy,” he said.

Headlines about layoffs and fewer graduate spots in the private sector mean graduates are turning to public service, where competition for graduate spots has jumped.

Applications for the Australian Tax Office’s graduate program, with its $49,000 starting salary and 15.4 per cent super, jumped from 1701 to 5312 applicants this year, most with tax, accounting, law or economics degrees.

Employers attending careers fairs have fallen 15 per cent, said Dawn White, president of The National Association of Graduate Careers Advisory Services (NAGCAS).

But having to fight hard to get a job could have a silver lining, as fewer grads fall into the formerly ‘safe’ career options of law, finance or accounting and think seriously about what they really want to do with their lives, she said.

Although investment banks are still recruiting on campuses, fewer students are showing up for their information sessions, said Ms White.

Students are now less likely to enter banking just to keep their parents happy, even though there are still jobs and even signing bonuses on offer.

“You read in the paper of a company cutting jobs, and then they ring up the next day and want to recruit grads,” said Ms White.

‘Hot jobs’ like IT or banking are just trends, and students are better off thinking carefully about what they really want to do, she said.

Recessions push people to make a more conscious career choice and think about what they are good at and what they really enjoy, because the ‘safe’ career track is gone, said Ms White.

“It might have made people realise there aren’t any specific safe industries, so it’s more important to do something you enjoy and gain transferable skills.”

“It’s forcing students to have a look at their priorities and their reasons for getting into things,” said Ms White.,27753,25643410-5012426,00.html

June 11, 2009 – 6:52AM

Economists are expecting today’s official job figures for May to show a sharp jump in the unemployment rate.

The jobless rate is tipped to bounce back to at least 5.7 per cent, where it stood in March and prior to the questionable fall to 5.4 per cent in April.

Deputy Prime Minister Julia Gillard is sticking with the May budget forecast that sees the unemployment rate soaring to 8.5 per cent by mid-2011, leaving one million people in the dole queue.

On Wednesday, the Westpac-Melbourne Institute consumer sentiment index for June surged 12.7 per cent, the second largest increase since the survey began in 1974 and the largest increase in 22 years.

The national accounts – released last week – showed gross domestic product (GDP) grew by 0.4 per cent in the first three months of the year.

The economy thus avoided a second straight quarter of negative growth, which would have meant it was in a technical recession.