The National Skills Commission’s Internet Vacancy Index (IVI) rose by 3.6 per cent in February (or 9,264 available positions) to a 13½-year high of 269,746 available positions. Recruitment activity is up 36.2 per cent over the year to February. Job vacancies were at all-time highs (since January 2006) in February for 15 occupations.
Skilled job vacancies rose in seven states/territories in February, led by gains in NSW (+3,210 job ads to 13½-year highs of 87,661) and Victoria (+2,988 job ads to 14-year highs of 71,352). Ads hit 13-year highs of 52,267 in Queensland; 13½-year highs of 30,503 in Western Australia; 13-year highs of 13,802 in South Australia; record highs (since January 2006) of 7,575 in the ACT; and 14-year highs of 3,271 in Tasmania.
Regional job vacancies rose by less than 0.1 per cent in February to 72,540 available positions. Vacancies are up 28.1 per cent on a year ago and are just below record highs of 78,870 roles in November 2021.
What does it all mean?
Considering job switching? Competition for workers is set to intensify, as measures of labour demand are the strongest in at least 14 years with the receding of Omicron virus variant disruptions and restrictions. Operating conditions for Aussie businesses returned to ‘normal’ after workers took extended holidays in January following lockdowns in 2021.
Amazingly, there were 269,746 skilled job vacancies across Australia in February. Recruitment activity is the most buoyant since August 2008, with the National Skills Commission’s job ads gauge at 13½-year highs, while the national unemployment rate hit 13½-year lows of 4.0 per cent in the same month.
In terms of the detail, the Internet Vacancy Index (IVI) from the National Skills Commission rose by 3.6 per cent or 9,264 available positions in February. Recruitment activity is up by an astonishing 36.2 per cent or 71,707 ads on a year ago. Job ads are now 60.4 per cent higher than pre-Covid levels, or around 101,600 available positions.
Skilled job vacancies rose in seven states and territories in February, led by gains in NSW (+3,210 job ads to 13½-year highs of 87,661) and Victoria (+2,988 job ads to 14-year highs of 71,352). February was an historic month for labour markets, with available positions hitting 13-year highs of 52,267 in Queensland; 13½-year highs of 30,503 in Western Australia; 13-year highs of 13,802 in South Australia; record highs (since January 2006) of 7,575 in the ACT; and 14-year highs of 3,271 in Tasmania.
Nationally, skilled job vacancies are at all-time highs (since January 2006) in February for fifteen occupation groups, as detailed in the below table. Australia currently has severe labour shortages for tradies, community and personal services workers, carers, auto mechanics and hospitality workers.
Australia’s regions have experienced a renaissance in the pandemic with near record recruitment activity. Regional job vacancies remained above the 70,000 mark in February, up by less than 0.1 per cent to 72,540 available positions. Vacancies are up 28.1 per cent on a year ago and are just below record highs of 78,870 roles in November 2021. Ads are at all-time highs in Geelong and Surf Coast, Victoria with 3,090 available positions in February.
With Australia’s labour market conditions broadly the best in almost 50 years, the shift in bargaining power towards employees and higher inflation expectations, should stoke wages growth. In fact, Commonwealth Bank (CBA) Group economists, expect annual wage growth, as measured by the Wage Price Index (WPI), to accelerate from 2.3 per cent in the December quarter, 2021 to around 3 per cent by the end of the June quarter, 2022.
In our view, the tightening of the labour market is expected to drive down the unemployment rate to 3.8 per cent in the second half of the year. And our preliminary estimate is for the annual growth rate in trimmed mean or underlying inflation by the end of June 2022 to be 3.8 per cent, well above the RBA’s 2-3 per cent inflation target range.
Our estimate is above the RBA’s inflation forecasts, so we expect the RBA to move to an explicit hiking policy bias at the May 2022 Board meeting, with our expectation for the first hike in the cash rate to occur at the June 2022 meeting.
What do you need to know?
Skilled job vacancies – February 2022
The Internet Vacancy Index (IVI) from the National Skills Commission rose by 3.6 per cent in February (or 9,264 available positions) to a 13½-year high of 269,746 available positions. Recruitment activity is up by 36.2 per cent (or 71,707 ads) on a year ago, and is 60.4 per cent (or around 101,600 available positions) higher than pre-Covid levels.
Skilled vacancies rose in seven state/territories in February: NSW (up 3.8 per cent or 3,210 available positions); Victoria (up 4.4 per cent or 2,988 job ads); Queensland (up 1.5 per cent or 752 job ads); South Australia (up 4.7 per cent or 628 job ads); Western Australia (up 1.7 per cent or 509 job ads); Tasmania (up 6.6 per cent or 202 job ads); Northern Territory (down 0.5 per cent or 15 job ads); and the ACT (up 4.1 per cent or 298 job ads).
Job advertisements increased across all eight broad occupational groups in February and in 40 of the 48 detailed occupational groups. Hospitality Workers recorded the largest increase over the month (up by 1,300 job advertisements or 14.2 per cent); followed by General-Inquiry Clerks, Call Centre Workers; and Receptionists (730 job advertisements or 3.8 per cent); and Food Trades Workers (640 job advertisements or 9.6 per cent).
In three-month moving average terms, job advertisements in regional areas have lifted by an average of 71.1 per cent in February 2022 compared to pre-pandemic levels. In February, North West Tasmania posted the strongest increase in job advertisements compared to pre-Covid-19 levels (up by 115.9 per cent or 310 job advertisements); followed by South-West Western Australia (up 114.6 per cent or 760 job advertisements); Tamworth and North West NSW (up 111.5 per cent or 610 job advertisements); Sunshine Coast Queensland (up 106.3 per cent or 1,700 job advertisements); and Gippsland Victoria (up 102.2 per cent or 1,400 job advertisements).
In three-month moving average terms, job advertisements in capital cities have lifted by an average of 35.9 per cent in February 2022 compared to pre-pandemic levels. Over the period, job vacancies have increased by the most in Melbourne (up by 14,800 job advertisements or 37.2 per cent); followed by Sydney (up by 9,400 job advertisements or 20.1 per cent); Perth (up by 9,100 job advertisements or 72.0 per cent); Brisbane (up by 8,000 job advertisements or 44.2 per cent); and Adelaide (up by 4,000 job advertisements or 59.3 per cent).
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