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The Olivier Internet Job Index provides a timely and fascinating monthly snapshot of the real economy. The research into what jobs are advertised on the net shows where the economy is strongest, by sector and state. An increasing number of commentators and economists are giving weight to internet stats and abandoning the newspaper ads as an employment indicator. John Edwards is quoted in this Shortlist article for example. The very detailed full analysis is to be found on the Olivier site, along with archived material. We will carry each month's release here, too. Price of People, Not Petrol Driving Inflation. Sydney, Sunday August 6, 2006. The Olivier Internet Job Index rose 2.22% in July with a total of 232,283 new job ads on line, creating yet another new record before last week's interest rate rise. “On past experience the job market misses a beat when we have an interest rate rise, but then kicks back in. This suggests that the market can sustain this rise, and we expect that the RBA has taken that into account when determining it,” Robert Olivier, a Director of the Olivier Group says. With the Australian inflation rate at 4% pa and now in the OECD's top 3 in the developed world there's reason to believe that this effect is substantially wage driven. “It's the price of people, as workers, not just the price of petrol or bananas that looks like the driver to us,” Robert Olivier says. The Olivier Internet Job Index releases have been warning of wage pressures for some time. “We've been saying for ages that then employment market is boiling hot. Unemployment is at a record low, the skills shortage is biting hard and in-demand employees know they have the upper hand,” Robert Olivier says. The CPI and interest rate rise may well push up wage demands again. “The danger is wage-driven inflation. When CPI goes up, employees want more money to compensate for inflation as well as for productivity increases”. As our graph shows, the jobs economy is now much stronger than it was in 2000 when we had the Olympics, the dot-com boom and the introduction of the GST driving growth. There are 11 internet job ads now for every classified newspaper job ad. Over the past 12 months the NSW employment market may have lagged nationally, but has been strong compared to Victoria. NSW grew 30.74% in 12 months – behind the national average of 38.20%, but ahead of Victoria's 27.76%. Significant growth in major sectors in NSW included a 67.97% growth in Education, 63.52% in Building and Construction and 50.92% in Engineering and Mining. IT and Telecommunications grew 42.44% in NSW in the last year, too. The ad numbers may reflect the pain of shortages in a very tight labour market. “People are running ads longer to drive the response,” Bob Olivier says. However New South Wales may be threatened most by an interest rate hike. Salaries in Sydney are 20 – 30% higher than in other state capitals, but the cost of housing and consequently mortgages are also much greater. The big boom states continue to be Western Australia and Queensland. WA grew 75.71% in jobs advertised in the past 12 months, with Trades and Services jobs up 120.51% and Building and Construction jobs up 110.62%. Transport was up 111.71% and Engineering and Mining grew 84.55%. Queensland also grew massively in Building and Construction – up 120.74% contributing to a year on year overall job ad growth of 51.41%. Engineering and Mining grew 60.87% and Trades and Services added 37.11%. Nationally transport job ads are down by 1.06% possibly reflecting fuel prices. Across the country Building and Construction continues to flourish, with an increase of 6.19% in the month. While housing approvals are down retail, commercial and infrastructure projects continue to be strong. IT and T posted a 3.90% increase in the month, which puts it as the third largest occupational sector after Sales and Marketing and Trades and Services. In fourth spot is Accounting with Engineering and Mining rapidly gaining at fifth. Robert Olivier is a Director of Olivier Group. The Olivier Internet Job Index surveyed 232,283 Positions Vacant ads on commercial job sites in July and analysed them by state and industry sector. Robert Olivier is available for interview, and the microeconomic data including graphs of the industry sectors surveyed in the Olivier Internet Job Index will be available on Monday August 7 on www.olivier.com.au Unless otherwise noted, all IJI figures quoted are seasonally adjusted, based on ABS advice. Released by Corporate Communications and Counsel. www.corpcoms.com Contact Bob Hughes 0407 901 587 or Katherine Scott 0415 764 159. Olivier Group, Level 9, 28 Margaret St, Sydney 2000. 9262 5344 Robert Olivier's spoken version of this month's release is here. |