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Deloitte reports stagnant private sector jobs growth in Australia

Duncan EvansNewsWire
Private sector job growth is stagnant in Australia, Deloitte has warned. NewsWire / Luis Enrique Ascui
Camera IconPrivate sector job growth is stagnant in Australia, Deloitte has warned. NewsWire / Luis Enrique Ascui Credit: News Corp Australia

Private sector job growth is stagnant in Australia, a leading economic forecaster has revealed, as warning signs continue to mount about the sputtering health of the economy.

Deloitte Access Economics’ latest employment forecast shows the number of private sector jobs increased just 0.1 per cent, or just 6000 jobs from a total of 322,000, in the year to March 2024

Growth in public sector employment, by contrast, accounted for 316,000 jobs for a 7.6 per cent growth rate.

“It is clear the resilience of employment growth is being driven by the non-market sector, while private sector hiring is stalling,” Deloitte report author David Rumbens said.

“Other data also highlights the weakness in at least part of the labour market: Job vacancies, job mobility and average hours worked are down and job security fears are rising.”

Job vacancies fell 8.7 per cent in the first half of 2024 and are now 26 per cent lower than in the middle of 2022, the report states.

Job mobility is also down, with the share of employed Australians switching jobs falling from 9.6 per cent to 8 per cent in 2024.

WEEKEND READ - AUSTRALIAN ECONOMY
Camera IconAustralia’s private sector job growth is stagnant, according to a new employment report from Deloitte. NewsWire / Luis Enrique Ascui Credit: News Corp Australia

The unemployment rate ticked up to 4.2 per cent in July and it is widely expected to drift upwards to 4.5 per cent into 2025.

Mr Rumbens warned that other indicators showed the economy was stagnating.

“The view that Australia’s economy is stagnating is more evident through GDP, retail spending and business insolvencies data than labour market data, which has remained relatively resilient,” he said.

The economy was now growing at its slowest rate since the recession of the early 1990s, Deloitte warned.

The consulting firm also predicts weak employment growth of 1 per cent, or 147,000 additional jobs, across 2024-25, even as new green shoots emerge from tax cuts and cost-of-living relief, which could buttress consumer spending.

The employment landscape looked especially dire for the white-collar workforce, Deloitte added, with a 0.4 per cent, or 23,500 workers, decline projected for 2024-25.

But blue-collar employment is expected to benefit in the short term from a “continued focus” on construction.

Blue-collar jobs are expected to grow 2 per cent, or 74,300, across the year before moderating to 0.4 per cent in 2025-26.

“As employment growth moderates, businesses are also looking to deliver productivity gains, particularly through technology investment and particularly through AI,” the report states.

“Tech-led productivity gains are seen as a key element to support the broader economic upswing over the next year.

“A greater focus on productivity along with the generally weaker labour market is providing further impetus to return white-collar employees back to the office.”

In state terms, Queensland is forecast to be one of the fastest-growing state economies on the back of an expected uptick in commodity exports.

“State employment is expected to increase by 2 per cent, or 58,400 workers, in 2024-25, the fastest growth in the nation, driven by strong demand across the human services and blue-collar workforce,” the report states.

The ACT was expected to be the fastest-growing state or territory economy in 2024-25, Deloitte added, aided by strong growth in government spending.

“Yet, the strong activity will unlikely spill over to large employment gains with employment growth expected to increase by a modest 0.9 per cent, or 2600 workers, in 2024-25 amid a hard-hit professional services industry and moderate public admin gains,” the report states.

Originally published as Deloitte reports stagnant private sector jobs growth in Australia

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