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Unemployment Rate Commentary

The drop in the unemployment rate announced earlier this month (to 4%) was unexpected and a closer look at the figures shows areas of concern that will impact the job market into the near and medium future:

  1. There is in fact a large increase in the number of people who are ‘under-employed’ – that is working less than they’d like to be.  Read hospitality and retail jobs under pressure and employers cutting hours rather than jobs, at least in the short term.  There’s no doubt that the focus for most at the moment is holding on to what they’ve got, even if it is less than they had.
  2. Normally in a recession male-dominated industries get hit.  So far the COVID impact has hit jobs in predominantly female sectors and women make up around 90% of those who have lost their jobs.  The shovel ready projects are not helping with this as they are in predominantly male industries, but the reliance in most families on two incomes will hit the economy and households none the less…watch this space as people ‘hold on’ and tough it out on one income or significantly less income than before.
  3. The number of people that fall within the NEET category (15-24 year-olds not in education, employment or training) has risen from 10.5% to 12.5%.  Things just got a lot harder for this population and changes here are often a pre-cursor to changes to the wider population later on.
  4. Anecdotally, jobs are incredibly hard to come by, particularly for those who are less skilled or looking for entry level jobs.  There are high numbers of applicants for these positions and employers are ‘fatigued’ with managing this volume
  5. The anticipated opportunity to ‘drain’ labour to the agri-sector has not happened (yet).   People do not see agricultural/horticultural sector jobs as aspirational  or long term answers to their career requirements and the pressure isn’t on enough yet to have large scale population shifts out of the main centres