And it is white-collar jobs that will lead the way according to Deloitte Access Economics partner David Rumbens.
Mr Rumbens said a key reason why the national labour market recovery has been so swift is federal (and state) government pandemic spending.
“The success of the baton pass to the private sector will determine the prospects for employment growth from here,” he said.
In Deloitte Access Economics’ latest quarterly Employment Forecasts report Mr Rumbens said Australia’s labour market has been the standout indicator of success since COVID and the lockdowns that so greatly affected the country’s way of living.
The unemployment rate is at 3.4 per cent, a near 50-year low, while the labour force participation rate hovers near a record high, at 66.4 per cent.
Deloitte Access Economics expects that total national white-collar employment gains may moderate from a record-breaking 352,200 in 2021–22, to a still strong 205,200 in 2022–23. National white-collar employment is expected to grow on average by 1.6 per cent per year between June 2022 and June 2032 – outpacing total national employment that is forecast to grow on average by 1.4 per cent per year.
Recreation services is forecast to be the fastest growth sector for white-collar employment during 2022–23 as international migrants, tourists and students gradually return and the risk of catching COVID subsides. Employment within the sector is expected to grow by 8.9 per cent or 67,500 workers.
The property and business services sector will be increasingly important for white-collar employment over the forecast horizon as the economy continues its shift towards a more skilled and knowledge-based workforce. Employment within the sector is expected to grow on average by 2.1 per cent or 39,300 workers per year between 2022–23 and 2031–32.
In terms of CBD markets, Sydney is expected to drive white-collar CBD employment in 2022–23, in part due to some remaining steam in its post-lockdown recovery. Growth by 12,200 workers is expected, but gains will in large part depend on Australia being able to return to typical levels of net overseas migration seen previously.
“The impact of pandemic-era international border closures combined with an incredibly tight labour market has seen the number of vacant jobs reach new highs – there are now fewer unemployed people than job vacancies,” Mr Rumbens said.
“Net overseas migration was positive for the first time since the onset of COVID. More than net 29,000 people arrived in the December 2021 quarter, although that only unwinds around 26 per cent of the net 113,000 people lost to overseas migration over the previous 18 months.
“The good news is that there are still more people arriving in Australia permanently, or long-term, than there are leaving – a strong indication that net overseas migration in Australia was positive through the first half of 2022, albeit a fraction of what it was before the pandemic.
“The federal government’s upcoming Jobs and Skills Summit certainly represents a rare opportunity for government, business, and unions to collaborate on the right policy settings for the near and longer term.”
Going forward, growth in the Australian economy is expected to slow amid the impact of inflation running ahead of wages, rising interest rates, and weaker global economic conditions.
“Economic challenges aside, there are still opportunities for white-collar workers in Australia, and it may still be some time before the number of unfilled job vacancies returns to more normal levels,” Mr Rumbens said.
