The March quarter labour market figures paint a rosy picture of Western Australia with an unemployment rate of 4.1 per cent, the lowest in the country and the highest employment growth at 2.2 per cent.
The March quarter labour market figures paint a rosy picture of Western Australia with an unemployment rate of 4.1 per cent, the lowest in the country and the highest employment growth at 2.2 per cent.
A HBOS Economic update confirms WA’s labour market is continuing to outperform the rest of Australia due to its robust domestic economy.
WA has maintained the lowest rate of unemployment of all states and territories since August 2005, driven by a strong demand for labour and the take up of full-time employment.
HBOS Australia chief economist Alan Langford said higher employment growth is a good reflection of a robust broader economy, with higher business investment and housing and construction still at high levels.
“Our housing market is a particularly labour intensive industry and has been attracting a high number of new employees to try to keep up with demand,” he said.
“The mining and resource sectors have also boosted labour figures, with workers attracted to projects off the north-west shelf and at Ravensthorp nickel.”
However, Mr Langford warned that employment growth in WA could mask the growing problem of underemployment, with some people working as little as an hour but still considered employed.
The participation rate, which is the proportion of the adult population either working or actively seeking employment, averaged a record high of 64.5 per cent nationally in 2005 and in WA hit 67.9 per cent in March 2006.
“Job vacancies peaked at 8 per cent nationally in the September quarter of 2005, possibly as a result of the bunching of a few large projects at one time but consequently we had to change the scale on the graph for the first time in many years,” he said.
Mr Langford expects employment growth to soften in WA and should stay around two per cent while figures would consolidate nationally as the Australian economy entered a more mature economic cycle.
Australian Bureau of Statistics figures on job advertisements show the average number of weekly vacancies in WA rose by 2.8 per cent over the three months to February 2006 and the 3,800 weekly advertisements in February are well above the long term average of 2,400 per week.
Mr Langford believes WA employees still have plenty of bargaining power when it comes to wages and the buoyant labour market may well fuel a little more wages growth in the short to middle term.
“Higher wages also feeds through to retail consumption and consumer confidence,” he said.
ABS retail trade figures indicate that WA has one of the largest increases in turnover for the Australian retail and hospitality/services series at a seasonally adjusted figure of 1.9 per cent to February 2006.
Strong consumer spending growth is evident in WA, with department stores, clothing, soft good and other retailers attracting a good percentage of the $1.8 billion in retail turnover in February 2006, compared with just under $1.7 billion at the same time last year.
