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Jobs Online monthly report – March 2010

Overview

Jobs Online measures changes in job vacancies advertised on the main internet job boards.

Jobs Online shows that job advertisements have increased over the three months to the end of March 2010. March is the ninth consecutive month where the number of job advertisements has increased. The increase in job vacancies — in conjunction with other indicators — indicates that employment prospects in the economy are improving and that the labour market is strengthening.

Key points

Jobs Online shows that for the three months to the end of March 2010:

Since June 2009, Jobs Online has highlighted a sustained recovery in advertised vacancies: advertised skilled vacancies have increased by 19% and total vacancies have increased by 23%. Alongside other positive indicators of economic growth and improving hiring intentions, Jobs Online shows that job prospects in the economy are improving. While the latest increase is encouraging, the number of skilled job advertisements in March 2010 is 39% lower than in March 2008, when the index was at its peak.

Despite increasing vacancies and improving hiring intentions, we expect the unemployment rate to remain elevated into 2011, due to an increase in the number of people actively looking for work.

Commentary

Job advertisements increase further.

Jobs Online shows that the number of job advertisements continued to grow in the three months to the end of March 2010. Job advertisements have increased every month since June 2009, when they were at their lowest point. While job vacancies remain below levels seen prior to the recession, the consistent increase in advertised vacancies over the last nine months is a positive indicator that the labour market is strengthening.

Total vacancies have increased by 9.5% in the three months to the end of March 2010 and by 23.1% since June 2009. Skilled vacancies have increased by 8.3% in the three months to the end of March 2010 and by 18.6% since June 2009. Skilled vacancies did not fall quite so far or as fast as total vacancies, and so have slightly less ground to recover.

These trends are graphed in Figure 1 below.

Figure 1: Skilled Vacancies Index (SVI) and All Vacancies Index (AVI)

Trend series (May 2007=100)

Figure 1: Skilled Vacancies Index (SVI) and All Vacancies Index (AVI) Trend series (May 2007=100)

Data table for Figure 1

.indicating that job prospects for many are improving.

Jobs Online, in conjunction with other indicators showing increasing hiring intentions [1], indicates that employment prospects in the economy are improving.

Strong economic growth over the December 2009 quarter — as well as other more recent indicators such as employee and consumer confidence — also indicate that the labour market is reaching a turning point.

…however, the unemployment rate is expected to remain elevated into 2011.

Despite increasing vacancies and improving hiring intentions, it is likely that the unemployment rate will remain elevated into 2011. This is because additional job growth must also cover:

Job advertisements have increased in all regions…

Table 1 shows that advertised skilled vacancies increased across all regions in the three months to the end of March 2010. Growth was particularly strong in the North Island: vacancies in Wellington rose by 12.7%, in Auckland by 10.4%, and in the rest of the North Island by 8.8%. While South Island vacancies did not increase as much, it was nonetheless a marked improvement compared to the decreases in last month’s report. Advertised vacancies increased by 0.6% in Christchurch and by 3.0% in the rest of the South Island.

Table 1: Skilled Vacancies Index (SVI) by region
Region Dec. 09 – Mar. 10 Mar. 09 – Mar. 10
Auckland 10.4% 9.4%
Wellington 12.7% 2.0%
North Island - other 8.8% 12.7%
Christchurch 0.6% 0.1%
South Island - other 3.0% -5.4%
Nationwide 8.3% 5.4%

Skilled vacancies did not fall as far in the South Island as in the North Island during the recession. However, the recovery of skilled vacancies in the South Island appears to be lagging behind that in the North Island.

Figure 2 below shows the long-term trends for Jobs Online by region.

Figure 2: Skilled Vacancies Index (SVI) by region

Trend series (May 2007=100)

Figure 2: Skilled Vacancies Index (SVI) by region<br />
Trend series (May 2007=100)

Data table for Figure 2

…and increased across most industries…

As shown in Table 2 below, the number of advertised skilled vacancies increased across nearly all industries in the three months to the end of March 2010. The biggest increases were in sales, retail, marketing & advertising (up 14.6%); IT (up 12.8%) and hospitality (up 7.1%). These industries fell significantly during the recession and so need to increase more than other industries to reach their previous peak levels reached in March 2008.

Growth in education, construction and engineering vacancies signals a significant turnaround in these areas compared to the declines in last month’s report. While health and medical vacancies showed a mild decline, this too is a substantive improvement from last month’s report, and health and medical vacancies look likely to be reaching a turning point.

Table 2: Skilled Vacancies Index (SVI) by industry group
Industry group Dec. 09 – Mar. 10 Mar. 09 – Mar. 10
Accounting, HR, legal, administration 3.8% -10.2%
IT 12.8% 10.1%
Construction and engineering 6.4% -22.7%
Education 2.9% -3.6%
Health and medical -0.4% -12.0%
Hospitality 7.1% 29.2%
Sales, retail, marketing, advertising 14.6% 48.8%
Other 9.6% 17.3%

Figure 3 below graphs the long term vacancy trends of industry groups.

Figure 3: Skilled Vacancies Index (SVI) by industry group

Trend series (May 2007=100)

Figure 3:  Skilled Vacancies Index (SVI) by industry group
Trend series (May 2007=100)

Data table for Figure 3

…with vacancies increasing across skilled occupation groups

Advertised vacancy growth over the three months to the end of March 2010 has been reasonably evenly spread across the major skilled occupation groups, as shown in Table 3 below. Job advertisements for technicians and trades workers showed the strongest growth over the quarter (up 10.7%), closely followed by professionals (up 9.0%).

Table 3: Skilled Vacancies Index (SVI) for high level (1-digit ANZSCO) occupations
Occupation group Dec. 09 – Mar. 10 Mar. 09 – Mar. 10
Managers 8.7% -2.1%
Professionals 9.0% 0.3%
Technicians and trades workers 10.7% 13.3%
All skilled occupations 8.3% 5.4%

Table 4 below takes a more detailed look at occupational groups, and shows that vacancies for half of the groups have exceeded their March 2009 levels.

Table 4: Change in advertised vacancies for selected occupations Three months to March end 2009 against three months to March end 2010
Occupational Group 2-Digit Occupation Mar. 09 – Mar. 10
Managers Chief executives, general managers and legislators 12%
Specialist managers 18%
Hospitality, retail and service managers 10%
Professionals Arts and media professionals -11%
Business, human resource and marketing professionals -5%
Design, engineering, science and transport professionals -24%
Education professionals 16%
Health professionals -24%
ICT professionals -11%
Legal, social and welfare professionals -18%
Technicians and trades workers Engineering, ICT and science technicians 3%
Automotive and engineering trades workers 17%
Construction trades workers 43%
Electro-technology and telecommunications trades workers -11%
Food trades workers 11%
Skilled animal and horticultural workers 10%
Other technicians and trades workers 10%
Community and personal service workers Health and welfare support workers -9%
Sports and personal service workers -6%
Clerical and administrative workers Office managers and program administrators 24%
Personal assistants and secretaries -13%
Inquiry clerks and receptionists 67%
Other clerical and administrative workers -10%
Sales workers Sales representatives and agents -18%
Table 4 compares the average number of job advertisements for the three months to the end of March 2010 with the average number for the three months to the end of March 2009. Note: this is not a trend series, and so differs from annual comparisons for the Skilled Vacancy Index. It is not yet possible to create a seasonally adjusted series for this table, as some of these occupational groups are small and the series has been running for such a short time.

Methodology

Jobs Online includes two separate indices: the All Vacancy Index (AVI) tracks all job vacancies listed, and the Skilled Vacancies Index (SVI) looks closer at skilled occupations [4]. The Skilled Vacancies Index is broken down further by detailed occupation, location and industry type. The results are presented as an index that measures changes in the number of job advertisements.

Vacancies are highly seasonal: for instance, there is usually a substantial fall in the numbers of jobs advertised during December and then a small increase in February. To remove such seasonality, the Jobs Online data reported here has been converted to a trend series [5], allowing us to compare figures between months.

Jobs Online replaces the previous Job Vacancy Monitoring Programme, which gathered data on job advertisements placed in newspapers. Jobs Online allows us to access a considerably larger number of advertisements in a timelier manner, and better reflects the dominance of online advertising in the recruitment sector, particularly in terms of advertised vacancies for skilled labour.

For more on Jobs Online, see the Background and Methodology report at http://www.dol.govt.nzmethodology/ or email the Labour Market Skills Team at info@mbie.govt.nz.


[1] NZIER’s Quarterly Survey of Business Opinion and the National Bank’s Business Outlook

[2] For instance, during the recession many discouraged workers facing unemployment decided to study instead, or to leave the labour market entirely. As job prospects improve, some of these people may decide to officially re-enter the labour market.

[3] In the year to February 2010, there were 21,600 more permanent long term arrivals than departures, a significant increase compared to the 6,200 recorded in the year to February 2009.

[4] Skilled occupations are defined as skill levels 1-3 under the Australia New Zealand Standard Classification of Occupations (ANZSCO). Skill level 3 is equivalent to an NCEA level 4 qualification. Vacancies for occupations outside these groups are much less likely to be advertised and may not be representative of labour market changes.

[5] Trend series have had both the seasonal and irregular components removed, and reveal the underlying direction of movement in a series.