Blackbook Executive

Where will the jobs of the future be?

Perhaps the greatest question of our time, of any time, of any society, is: where are employment and prosperity being generated? Let’s look at job growth and loss across Australia and ask: who have been the winners and losers in the job market since the year 2000 and what does this say about our prospects for prosperity over the next five years?

 

map - job growth

 

The number of people living in Australia with a job increased by 3.3 million or 38 per cent over 17 years to just under 12 million at February 2017. Roughly one in two Australians (of all ages) is in the workforce. Part-time jobs grew faster (68 per cent) than fulltime jobs (27 per cent) but off a smaller base. This means that even though fulltime job growth (1.8 million) has been marginally greater than part-time job growth (1.5 million) since 2000, the latter is gathering momentum.

Australia is shifting towards more part-time employment

Part-time workers accounted for 26 per cent of the workforce in 2000 whereas today that proportion is 32 per cent. The vast majority of workers still work fulltime. Even so, part-time work is rising due I think to a range of factors, including a requirement by business for a more flexible, agile, workforce as well as a shift in the nature of work: less factory work and more services and/or hospitality work. More women in the workforce and a shift in household values where income-earning is shared between partners can also lead to a rising preference for part-time work.

The thing that gets politicians and others excited about job growth is distribution. The ABS divides the Australian continent into 88 labour market regions ranging in size from a population base of 774,000 for Southeast Melbourne (Dandenong, for example) to 38,000 for Southeast Tasmania (eg, hinterland of Hobart). In two of these regions job growth since February 2000 has exceeded 90 per cent or more than double the national average, namely Mandurah, south of Perth, and Melbourne’s west (eg, Melton). In Moreton Bay South (eg, Caboolture) the increase was 84 per cent, on the Gold Coast it was 79 per cent and on the Sunshine Coast it was 61 per cent.

Australian job growth in the 21st century

The number of Australians with a job living in the Mandurah region increased from 21,000 in February 2000 to 40,000 earlier this year. Most job growth in this region was in part-time work (up 11,000 jobs) compared with fulltime work (up 8000). Of course Mandurah and the other regions cited are places of strong population growth. They are all evolving as commuter, retirement, lifestyle zones but with aspirations to evolve further into capital-city-independent work hubs. The data records job numbers by worker’s place of residence, which means in many of the fastest growing labour market regions, some are probably commuting.

In other parts of the nation workers are clustering around job-generation centres. For example, in Inner & South Sydney (say, CBD and Green Square), the number of resident workers jumped by 74 per cent from 113,000 in 2000 to 197,000 in 2017. That’s an extra 84,000 resident workers who can theoretically take out a mortgage and underpin the inner-city’s cafes, bars and restaurants. In broad terms the worker-bee population in Inner Sydney has increased at an average 5000 a year this century.

In Inner Brisbane, the average growth in the resident worker population over this period has been just over 3000 a year while in Inner Melbourne the equivalent figure is around 8000. Frustratingly the three “inner city” regions cited are not equally defined: Inner Melbourne for example contains 619,000 residents whereas Inner Brisbane contains 261,000 residents. Even so the figures confirm the transformative impact of Australians making one of two distinct lifestyle choices: live in a lifestyle locale and possibly commute or live near the state’s greatest work hub, the capital city CBD.

At the other end of the spectrum are places of net job loss since 2000. Only three of 88 labour market regions have experienced net job loss since 2000 and all are in the marginal lands of the interior, including Outback Queensland (down 14 per cent), the WA Wheatbelt (down 6 per cent) and the NSW Far West (including Broken Hill) (down 1 per cent). In some cases job loss is associated with population loss but in others, such as the wheatbelt, the population is still growing (up 7 per cent) even though jobs are contracting. I suspect wheatbelt towns are increasingly retirement communities.

Top 20 fastest growing job markets in Australia in the 21st century

Some industries are generating jobs. Since February 2000 most job growth in Australia has been delivered into healthcare and social assistance (up 730,000 jobs), professional services (up 440,000), education (up 330,000) and construction (up 410,000) sectors. These are mostly skilled and/or knowledge worker jobs. Knowledge worker jobs in Australia are largely concentrated in the CBD and inner city in corporate head offices, professional services firms, government administration and in large hospitals and universities. These job generators attract knowledge workers who prefer not to commute, underpinning demand for apartments.

On the other hand jobs that have contracted in the 21st century include manufacturing (down 130,000) and agriculture (down 120,000). Australia’s manufacturing capability has been marginalised by globalisation (the Chinese can deliver better efficiency) whereas agriculture has been reshaped by mechanisation and farm aggregation.

There are several themes underpinning the geography of Australian prosperity in the 21st century. The Australian workforce is subject to forces such as globalisation and automation that can easily shift the economics of a business’s operation. And the values of the Australian workforce and community are also changing. The former singularity of Australian suburbia as our preferred lifestyle shifted a decade ago to embrace seachange then treechange. But then something odd happened: we morphed again in our preferences, suddenly seeing new value in inner-city living and an apartment boom ensued.

The questions this analysis of work trends pose are important. Suburbia and even seachange and treechange have risen and subsided as driving forces behind Australian lifestyle preferences. How long has inner-city-living got to run before we find a new and shinier lifestyle preference? I think suburbia ran for 40 years (1950-1990); seachange and treechange for the next 20. On this logic inner-city living underpinned by CBD-based knowledge work should dominate this decade and at least part of the 2020s.

But what lies beyond? What better lifestyle could the Australian people possibly want? How about knowledge workers and small business operators streaming out of the city in pursuit of lifestyle locations offering housing affordability. This would require a shift in technology (eg, universal access to NBN), a shift in values (eg, the inner city is regarded as threatening and harsh as opposed to chic and sophisticated), and the emergence of a culture that celebrates small business start-ups.

I am sure the current trajectory will be maintained for some years but I can foresee a different distribution to Australian prosperity by the mid-2020s onwards. If I am right, hipsters have less than a decade to reinvent themselves as hippiesque entrepreneurs operating net-based busi­n­esses in places like Mullumbimby.

 

Article credit – http://www.theaustralian.com.au/business/opinion/bernard-salt-demographer/job-growth-in-australia-points-to-future-prosperity/news-story/4e6b4a314798e41a602254513f03aaf2

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