Public Service Industries See Strongest Job Growth in First Quarter

Employees are seen at work during a workshop tour, in Melbourne, Australia, on April 20, 2023. (AAP Image/James Ross)

Public services industries show the strongest growth in the number of jobs in the country, according to the latest labour market report released by the Australian Bureau of Statistics (ABS).

The report said that the three leading industries that experienced the strongest growth are healthcare and assistance (87,300), public administration and safety (23,200), and education and training (17,900).

The same report also said that the professional, scientific, and technical services experienced a decline in job growth (25,700).

This comes amid the ABS reporting that the country experienced slow labour market growth of 0.8 percent.

“Over the past five quarters in particular, we’ve seen strong labour market growth in the three non-market sector industries—health care and social assistance, education and training, and public administration and safety—compared to the industries in the market sector,” said Bjorn Jarvis, ABS head of labour statistics.

“This suggests recent jobs and hours growth has been underpinned by activity around public services, rather than it being broad-based strength across the entire economy and labour market.”

As more Australians become older, the demand for healthcare workers and professionals is expected to increase further.

In the Jobs and Skills Australia’s Care Workforce Labour Market survey, it is expected that the country will experience a shortfall of healthcare workers in 2050.

Mr. Jarvis also noted that the report recorded the slowest annual growth in hours worked since March 2021.

“The slower growth in hours worked in the March quarter reflected a larger than usual number of people taking leave or waiting to start work over January, as well as continued weakness in industries that rely on discretionary consumer spending,” he said.

The latest report comes after an April statement by Minister for Skills and Training Brendan O’Connor lauding the country’s low unemployment rate of 3.8 percent under the current government.

The Albanese government said it generated more than 780,000 new jobs.

“More jobs have been created under the Albanese Labor government, than any other first-term government on record,” said Mr. O’Connor in a previous statement.

Meanwhile, the ABS reported that job vacancies fell further to 4.3 percent.

“Despite a 25 percent drop from the peak in job vacancies seen in September 2022, there were still over 60 percent more vacant jobs than we saw before the pandemic. There is still plenty of demand for workers, which is contributing to growth in employment,” Mr. Jarvis said.

Multiple Job-Holders Rise

Apart from essential industries, the ABS report found that the number of multiple job-holders rose by 12,000 (1.2 percent) in April 2024.

Thus, the multiple-job handling rate remained at 6.7 percent, which is still above the pre-pandemic range of around 5.2 percent to 6 percent.

Greg Jericho, Chief Economist of The Australia Institute, attributed the rise in multiple job-holders to a more than 5 percent decline in real wages over the past three years, with inflation rising above wage growth.

Mr. Jericho said that 7.1 percent of jobs in Australia are someone’s second or third (or more) jobs.

“This is not a sign of a healthy labour force. While it is good that Australians are able to find work, that nearly 1 million are clearly needing to seek more hours from a secondary job suggests that there has been a growing problem of working poor,” said Mr. Jericho.

Minimum Wage Increased

The Fair Work Commission already declared a 3.75 percent increase in modern award rates on top of the scheduled 0.5 percent rise in Superannuation Guarantee Rate.

Workers’ unions welcomed the decision, which, on the other hand, threatens businesses that will bear the brunt of higher cost of doing business.

“This decision allows people to keep up with inflation and have a small real wage increase. If employers got their way, Australian workers would’ve seen a significant real wage cut while facing cost-of-living pressures,” said Sally McManus, secretary of the Australian Council of Trade Unions.

Robert Potter, national secretary of the Australian Services Union, said the decision reflected the pressure workers have been facing to meet their living costs.

The unions also lauded the Fair Work Commission’s acknowledgement that workers in feminised jobs and sectors have been undervalued.

“The Fair Work Commission has accepted our argument that the wages of workers in feminised industries need to be higher, though they haven’t agreed with us that it should start immediately. Unions will continue to fight for these increases through the process the Commission has established,” said Ms. McManus.

“This increase will especially benefit women, who comprise three-in-five workers, and make up the majority of workers in the social and community services sector but also administration and telemarketing sectors,” said Mr. Potter.

However, the Australian Industry (Ai) Group said that the move underestimates the challenges businesses are experiencing and will only put workers at risk of losing their jobs.

“Crucially, the decision highlights that we desperately need to turn around our productivity problems. Without a sharp uptick in productivity, employers will have to either pass on higher wages to consumers, and/or cut back on employment,” said Innes Willox, CEO of the Ai Group.

“The increase of 3.75 percent will add to pressures in wage negotiations for similar increases for above-award employees. It is critical that we do not see these wage increases, decided in the currently high inflation environment, locked in for many years via multi-year enterprise agreements.”

Labor Government Asserts Commitment to Striking Right Balance

Meanwhile, the Liberal Party blames the Albanese government for not addressing the inflation head-on which, Shadow Minister Angus Taylor says, has led Australians to be worse off.

“On any measure, Labor isn’t delivering strong economic management. The only thing keeping Australians’ heads above water in this cost-of-living crisis are their jobs,” he said.

In a June 5 press conference, Treasurer Jim Chalmers said the Albanese government is striking the right balance between addressing inflation, providing cost of living relief, supporting sustainable economic growth, and strengthening public finances at the same time.

However, Mr. Taylor said that the government needs to prioritise the economy and not proceed to a path of economic destruction.

“We need to get the economy back on track and back to basics and restore Australia’s standard of living,” he said.