Record numbers of job vacancies suggest it has never been easier to find work, but economists fear the data is masking crippling skill mismatches.
About 362,500 job vacancies were recorded during May, which was 57 per cent higher than pre-COVID levels, the ABS revealed on Thursday.
A job was available for every 1.9 people unemployed – the lowest number since records began in 1983 – and down from 2.8 in February.
“Businesses across all industries have reported difficulties in filling vacancies,” ABS head of labour statistics Bjorn Jarvis said on Thursday.
But is it actually that easy to find a job? Many people are still struggling.
For example, despite record numbers of job ads and the unemployment rate falling to 5.1 per cent in May (the pre-COVID level), there are still 229,000 more people on JobSeeker payments today than in March 2020.
Job vacancies ‘mismatch’
It’s not because job seekers aren’t trying to find work, either.
Indeed APAC economist Callam Pickering said there’s a “mismatch” in the labour market right now that’s frustrating their efforts.
Basically, although job vacancies are high, many are in industries typically reliant on migrant labour, which is currently affected by closed borders.
Local workers haven’t done these jobs in any great numbers for years, and so they aren’t always able to jump in to fill these labour gaps.
“A lot of industries rely on skilled migration to fill some roles, particularly in tech, health care and professional services,” Mr Pickering told TND.
“That’s contributed to a mismatch between jobseekers and jobs offered.”
Some job seekers ‘missing out’
Meanwhile, Mr Pickering said many local unemployed workers had been working in industries struggling with COVID, like tourism and hospitality.
“Some industries remain heavily impacted, and as a result there are groups of people who are missing out,” Mr Pickering said.
“We’d hope all this job creation will start eating into that.”
Accommodation and food services, an industry that’s both reliant on migrants and exposed to pandemic restrictions, employs about 50,000 fewer workers today than before the pandemic and has about 38,000 job ads.
Meanwhile, less than half of pre-COVID jobs have returned in the tourism industry, leaving employment levels about 10 per cent lower today than in 2019.
Middle-income jobs behind
There’s also an apparent mismatch in pay.
Employment for the middle- and second-lowest-earning job groups is below pre-COVID levels, ANZ economists said on Thursday.
It means workers with skills corresponding to those income levels are worse off than those in the lowest and highest income brackets, where jobs have recovered to pre-COVID levels.
“It is clear that those with the skills and experience to work in higher-paying jobs have had relatively better employment outcomes since the pandemic, which is a concern for inequality,” ANZ economists said.
Workers staying put
Despite all these labour mismatches, there’s still less job seeking activity than economists had anticipated, Mr Pickering said.
This might be because many workers (both those with and without jobs) are behaving cautiously during the pandemic.
“Businesses are hiring as though they’re in a boom, but households and individuals are still acting as though we’re in a pandemic,” Mr Pickering said.
He told The New Daily the behaviour is partly because job seekers are more reluctant to take jobs out of fear for being exposed to COVID-19.
But it also shows workers who have jobs are prioritising job security over finding higher-paying work on the market.
“Normally, in a strong labour market, you would see people looking for new jobs and opportunities because there’s higher wages on offer,” Mr Pickering said.
“We’re not seeing that right now.”
The good news is that economists are expecting the recent flood of job ads to flow through to stronger employment outcomes over the next six months, which should help many people without jobs find new work.
“[Vacancies] should continue to support employment growth and drive the unemployment rate down,” ANZ economists said on Thursday.
“With the job vacancy rate at a new record high, we expect to see wages growth accelerate through 2021 to reach 3 [per cent by the second half of] 2022.”