The mainstream media are full of big job loss stories such as Alcoa, QANTAS and Toyota but out there in the SME sector, where the economy's engine really hums, there's signs of life.
I have been speaking to a lot of recruitment agency owners over the past 6 weeks and almost without exception they are all smiling again. February was a much better month than January, December or November and, even better, the pipeline for March is looking strong.
This good news was further reinforced with the February results for the ANZ Job Index, released early last week, which showed a monthly hike in listings of 5.1% to reach 131,189 listings, the highest since May 2013 and the largest monthly rise in nearly four years.
I'm calling it. The job market is picking up steam and the rest of 2014 is looking good. The real estate market in the major cities has seen a surge in average prices over the past six months or so. This is always the trend - real estate prices pick up as company owners and managers receive greater profit share (Australian corporate profits were up 4.9% in the December quarter and 10.3% over the year). Then the job market picks up as excess capacity within businesses is absorbed and more jobs are created to meet demand for greater production or delivery of services.
Vacancies registered with recruitment agencies are always a trend indicator preceding official jobs growth. I expect that the employment results for May (possibly April) that are released by the ABS in mid-June will provide evidence of the trend that our industry is now seeing.
This market pick up is verified by the recently released National Accounts for the December quarter which show seasonally adjusted December 2013 growth (0.8%) as one third stronger than the equivalent September 2013 growth figure (0.6%).
As Smart Company noted earlier last week:
Against that the jobs data was negative and looking like it would worsen in line with forecasts, before it would improve. But the turmoil over the Holden announcement had little impact on consumers: they started using their savings (the household savings ratio fell below 10% for the first time since mid-2010), spent more in shops, on property and overseas travel.'
Professional services firm, Deloitte reported more bright news last week:
‘(In) 2012-13 Australian exports of business services (eg computer services, scientific services and professional services) totalled $12.5 billion, up by 13% from the previous year and nearly balancing the level of imports.
So buckle up. I expect the financial results for the final quarter of this financial year to be the best quarterly result for our industry for at least a year to eighteen months.
Are you ready?