A journey through the Victorian labour market
Ivan Neville
Assistant Secretary
Labour Market Research and Analysis Branch
Regional Victoria is older and haslower population growth
May 2019
13.6
16.9
7.2
25.2
0.0
5.0
10.0
15.0
20.0
25.0
30.0
Increase in the civillian population over thelast five years (%)
Proportion of the population aged 65+ (%)
Per
cen
t (%
)
Greater Melbourne Rest of Victoria
Age group share of total population (%)12.0 9.0 6.0 3.0 0.0 3.0 6.0 9.0 12.0
15 - 19
20 - 24
25 - 29
30 - 34
35 - 39
40 - 44
45 - 49
50 - 54
55 - 59
60 - 64
65 - 69
70 - 74
75 - 79
80 - 84
85+
Age group share of total population (%)
Regional Victoria Greater Melbourne
199420192044
Regional Victoria’s age problem is not going awayProjected population age distribution in Victoria
Labour market conditions in Victoria remain strongKey indicators, year to June 2019
• Employment – up by 126,500 (or 3.9 per cent), above the decade annual average
growth rate of 2.5 per cent
• Full-time employment – up by 71,900 (or 3.2 per cent)
• Part-time employment – up by 54,500 (or 5.2 per cent)
• Unemployment rate – 4.8 per cent, down from 5.5 per cent a year ago
• Participation rate – 66.1 per cent, up by 0.4 percentage points over the year
Labour market conditions in Melbourne have been particularly strong
Over the year to June 2019:• Employment up by 100,200 (or 4.0 per cent).• Unemployment rate down by 1.0 percentage
point to 4.7 per cent.• Participation rate up by 0.2 percentage points to
67.3 per cent.
Rest of Victoria
Over the year to June 2019• Employment up only modestly, by 10,600 (or 1.5
per cent).• Unemployment rate down by 1.0 percentage
point to 4.3 per cent.• Participation rate down by 0.6 percentage points
to 61.2 per cent.
Greater Melbourne
Disparity in unemployment rates at the LGA level
High unemployment small areas:Corio – Norlane (21.6%)Broadmeadows (18.8%)Meadow Heights (17.6%)Campbellfield – Coolaroo (15.2%)Melton (15.1%)
Source: ABS Labour Force Australia, Detailed, Quarterly, August 2018 (cat. no. 6291.0.55.003), Department of Employment, Skills, Small and Family Business
The structure of employment is changingChange in share of employment May-09 to May-19 (% points), main employing industries
-1.1
-2.5
2.1
-1.5
-0.4
0.6
1.0
1.5
1.4
0.0
-3.7
0.4
-0.2
0.1
1.9
0.6
0.3
2.6
Agriculture, Forestry and Fishing
Manufacturing
Construction
Retail Trade
Accommodation and Food Services
Professional, Scientific and Technical Services
Public Administration and Safety
Education and Training
Health Care and Social Assistance
Greater Melbourne Regional Victoria
Health Care and Social Assistance
59,900 jobs
Industry growth in the cityEmployment growth in Greater Melbourne, five years to May 2019
Professional, Scientific and Technical Services
56,200 jobs
Retail Trade
39,400 jobs
Construction
48,500 jobs
Wholesale Trade
700 jobs
Mining
1,600 jobs
Education and Training
28,000 jobs
Health Care and Social Assistance
53,600 jobs
And it’s expected to continueProjected employment growth in Greater Melbourne, five years to May 2023
Professional, Scientific and Technical Services
38,400 jobs
Construction
36,300 jobs
Wholesale Trade
3,300 jobs
Mining
500 jobs
Public Administration and Safety
12,300 jobs
Industry growth in the regionsEmployment growth in regional Victoria, five years to May 2019
Health Care and Social Assistance
20,100 jobs
Education and Training
10,700 jobs
Construction
12,500 jobs
Retail Trade
4000 jobs
Agriculture, Forestry and Fishing
6800 jobs
Same suspects to provide future growthProjected employment growth in regional Victoria, five years to May 2023
Accommodation and Food Services
4,600 jobs
Health Care and Social Assistance
13,900 jobs
Education and Training
4,300 jobs
Construction
6,200 jobs
Mining
200 jobs
Strong construction growth across all sectorsEmployment growth in Construction sectors over the five years to May 2019, Victoria
7.9
15.6
18.1
34.9
51.8%
65.8%
258.8%
22.2%
0.0% 50.0% 100.0%150.0%200.0%250.0%300.0%
Heavy and Civil Engineering Construction
Residential Building Construction
Non-Residential Building Construction
Construction Services
0 5 10 15 20 25 30 35 40
Construction declined by 14,700 over the year to May 2019
Construction Services declined by 15,700
The Manufacturing industryEmployment over the five years to May 2019
Victoria
100 jobs
Regional Victoria
2,100 jobs
Greater Melbourne
2,200 jobs
4-quarter averaged data
Food and Beverage ManufacturingEmployment over the five years to May 2019, Victoria
Beverage Manufacturing
Meat and Meat Product Manufacturing
Dairy Product Manufacturing
Fruit and Vegetable Processing
Other Food Product Manufacturing
4,400 jobs
3,900 jobs
3,200 jobs
2,500 jobs
5,200 jobs
25.3 per cent of Victoria’s Manufacturing industry are employed in the Food Product Manufacturing sector
Advanced ManufacturingForging the path ahead
Employment over the five years to May 2019, Victoria
Advanced Manufacturing*
2,400 jobs
*Excluding Motor Vehicle and Motor Vehicle Part Manufacturing, which declined by 10,300.
Strong growth in:
Pharmaceutical and Medicinal Product Manufacturing (3,200)
Other Machinery and Equipment Manufacturing (1,300)
Smart industry needs smart workersIndex of online vacancies for skilled occupations
(March 2011 = 100)
Health Professionals33%
Bendigo & High Country
32%
Share of skilled vacancy growth in regional Victoria over the five years to June 2019:
Geelong & Surf Coast 25%
0
50
100
150
200
Greater Melbourne Regional Victoria
Invest in your workforceApprenticeship and Traineeship commencements and completions, Victoria
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
50,000
2014 2015 2016 2017 2018 2014 2015 2016 2017 2018
Commencements Completions
Recruitment difficulty is increasingRecruitment difficulty in Victoria - proportion of employers, by skill level, year
25%
30%
42%
47%44%
55%
34% 36%
48%
2016 2017 2018
Lower Skilled Higher Skilled Total
Skill shortage researchProportion of skilled vacancies that were not filled, Victoria
56%
32%
0%
10%
20%
30%
40%
50%
60%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Technicians and Trades
Professions
Trade shortagesVictoria National*
● Motor Mechanics ● Automotive Electrician● Sheetmetal Trades Worker ● Aircraft Maintenance Engineer● Panelbeater ● Stonemason● Vehicle Painter ● Glazier● Bricklayer ● Wall and Floor Tiler● Carpenters and Joiners ● Baker● Plumbers ● Pastrycook● Hairdresser ● Butcher or Smallgoods Maker● Cabinetmaker ● Arborist
Regional Victoria
● Metal Fabricator
Metropolitan Victoria
● Fibrous Plasterer
Average applicant numbers have fallen in recent years, and most (86%) are regarded by
employers as unsuitable
In addition, around two thirds of qualified applicants are
regarded as unsuitableMany lack the required trade
and industry specific experience
Less than half hold a formal trade qualification
Why do trade vacancies remain unfilled in Victoria?
Why are qualified applicants unsuitable?
Why are applicants unsuitable?
Despite strong employment growth, LTU remains above pre-GFC levels
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
Lon
g-te
rm u
ne
mp
loye
d (
'00
0)
Greater Melbourne Rest of Vic.
Who has been missing out?The jobactive caseload in Victoria, June 2019
87,500|44,200
2,000|3,000
9,600|1,000
9,900|2,000
7,300|5,100
13,000|6,600
32,000|3,000
24,700|12,700
24,500|13,300
29,300|16,500
Caseload Total
Indigenous
Refugee
University
Ex Offender
Mental Health
Culturally and Linguistically Diverse
People With Disability
Age 50+
Trade or TAFE
Greater Melbourne Regional Victoria
Migration has been a key contributor to employment growth in Victoria
Over the five years to June 2019:
• Persons born overseas made up 52.1 per cent of employment growth
• The proportion of total employment comprised of recent migrants up by 1.5 percentage points to an equal record high of 6.0 per cent in June 2019
Skilled migrants are not being fully utilisedProportion (%) of working age population who have a Cert III or above qualification
November 2016, Victoria
20%
13% 12%
5%
3% 4%
13%
9%11%
0
5
10
15
20
25
30
35
40
45
OTMESC MESC Aus. Born
Pro
po
rtio
n (
%)
of
wo
rkin
g ag
e p
op
ula
tio
n w
ho
h
ave
a C
erti
fica
te II
I or
abo
ve
Not in the labour Force Unemployed Employed in lower skilled occupations
The gig economyNot as big of a problem as is speculated nor a new phenomena
6.2 6.2 6.2 6.26.5 6.5 6.4
6.7 6.9
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
Mar
-11
No
v-1
1
Jul-
12
Mar
-13
No
v-1
3
Jul-
14
Mar
-15
No
v-1
5
Jul-
16
Mar
-17
No
v-1
7
Jul-
18
Mar
-19
Seco
nd
ary
job
s as
a %
of
tota
l fill
ed
job
s
• Secondary jobs – 982,700 in March 2019
nationally
• Secondary jobs make up less than
7 per cent of total filled jobs
• Worker’s main job accounted for 86.0 per
cent of total jobs growth over the year to
March 2019
Digital Platform Work in Australia
• Survey of 14,000 adult internet users conducted in early 2019
nationally
• Found 7.1 per cent worked through a digital platform currently
or have done so within last 12 months
–Victoria’s proportion was slightly higher, at 7.4 per cent
Source: Digital platform work in Australia: preliminary findings from a national surveyDepartment of Premier and Cabinet, State of Victoria 2019
Secondary jobs more prominent in some industriesSecondary jobs as a proportion of total filled jobs, March 2019, Australia
6.9
7.3
7.4
7.7
8.4
11.1
11.5
25.6
0.0 10.0 20.0 30.0
All industries
Accommodation and Food Services
Agriculture, Forestry and Fishing
Rental, Hiring and Real Estate Services
Information Media and Telecommunications
Arts and Recreation Services
Education and Training
Administrative and Support Services
Secondary jobs as a % of total filled jobs
Unique challenges exist
Issues
• Regional areas’ ageing population
• Strong growth in industries creating skill shortages and recruitment difficulty
• Skill shortages might worsen with the significant investment in infrastructure
Solutions
• Invest in training
• Job seekers could be used to meet skill shortages with training
• Migrants’ skills need to be fully utilised
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