Pete Wargent blogspot

CEO AllenWargent Property Buyers, & WargentAdvisory (institutional). 6 x finance author.

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Tuesday, 24 January 2017

Soggy with damp patches

2016 slowdown

First, the good news! Total employment increased to 12,093,400 in seasonally strong December, the highest number of employed persons in Australia's history. 

After a blistering year for jobs growth in 2015 when more than 300,000 jobs were added, the last calendar year was considerably slower, with employment growth sagging to +89,2000 or +0.74 per cent. 

Greater Melbourne, in essence, added the new jobs on a net basis last year. 

The main change during the year was that annual employment growth in Greater Sydney slowed all the way back to 1 per cent, from a massive 4.2 per cent at the 2015 peak.

And in Greater Brisbane, employment growth stalled.

It's not all bad news, though. 

A whole range of metrics confirmed that the economy went into a very soggy patch in the third quarter of the year, reflected in a negative GDP print, but there does appear to have been a bit more momentum picking up towards the end of the calendar year.

Around the major capital cities, only Greater Sydney is in fine nick from an unemployment rate perspective - sporting an unemployment rate of under 5 per cent - followed by Brisbane and then Melbourne.  

In Greater Perth, the trend is still upwards. 

Around the traps...

The ABS figures don't cover all sub-regions in detail, but it's clear that the resources-influenced regions have endured a tougher stretch since the peak of the resources construction boom in 2012.

That said, it does seem that in many areas employment may now be forming a base.

You may snort with derision - as indeed you are entitled to! - but Louis Christopher of SQM Research believes that some of the hardest hit mining regions such as Karratha in Western Australia may now be passing a housing market nadir. 

It's usually well worth taking careful note of his market analysis.