Job vacancies surge in Australia as Covid labour shortages choke supply chains | Australian economy

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Job vacancies surged across Australia as the lockdowns ended last year, highlighting staff shortages that are now crippling economic activity as Covid cases soar.

In the September-November period, job openings jumped almost a fifth or 18.5% from the previous three months, to 396,100, the Australian Bureau of Statistics said on Wednesday.

That tally was almost three-quarters higher than February 2020, prior to the Covid pandemic disruptions, Bjorn Jarvis, head of the ABS’s labour statistics unit, said.

“These figures continue to show the high demand for workers from businesses emerging from lockdowns, together with ongoing labour shortages, particularly in lower-paying industries,” Jarvis said.

All sectors of the economy reported higher vacancies, led by the private sector with job openings at 361,700, or up 19.4% from August. Public sector vacancies were up 9.7%.

“Job vacancies were also elevated in all states and territories, ranging between Western Australia, where job vacancies were 120% higher than before the pandemic, and 49% in the Australian Capital Territory,” Jarvis said.

Arts and recreation, and accommodation and food services had the biggest increases in job openings, rising about 260% and 210% respectively, compared with February 2020.

While the figures pre-date the rapid spread of the Omicron strain, they underscore how tight the labour market was prior to the latest economic distortions, with companies now struggling to fill for staff who have Covid or are in close contact with those who do.

Tim Nieuwenhuis, managing director of Workfast Australia, a company that recruits staff for firms ranging from warehousing to mines and other major projects, said the current job shortages were “way worse” than during the depths of the Delta wave that kept Victoria, New South Wales and the ACT locked down for months in 2021.

“We’re getting a phenomenal amount of calls,” he said, with the well-publicised logistics bottlenecks just part of the problem. “Everything’s hit equally across the board.”

Fears for construction industry

Major construction projects, such as new roads and other infrastructure, have been gearing up to start in early 2022 as part of state and federal economic stimulus plans, Nieuwenhuis said. These were now being stalled as developers find their work rosters depleted by absentees, or they can’t secure the necessary materials or equipment because of distortions affecting suppliers.

“If they continue on this path they are going to kill businesses faster than lockdowns,” he said.

Nieuwenhuis predicted that because there is less government support now workers will simply decline to take Covid tests if all the symptoms they have are similar to flu.

A common response increasingly will be, “If they’re sick, stay at home, if you’re not, go to work,” he said. “Don’t worry about getting tested.”

The decision announced by the NSW premier Dominic Perrottet on Wednesday to threaten a fine of $1,000 for those who test positive to a rapid antigen test but don’t report it will only encourage people to avoid tests.

“Logic would have it that to avoid penalties and to continue working, workers will not have the test,” Nieuwenhuis said. “We advise all workers to follow instructions but judging by what employers are telling us, workers are desperate to work.”

Empty supermarket shelves in Sydney on Wednesday. Australia’s chocked supply chains are affecting food and retail as well as construction and manufacturing. Photograph: Bianca de Marchi/EPA

ACTU boss Sally McManus also expects the construction industry to see knock-on effects from the choked supply chains.

“It’s closed, major construction is closed,” McManus said, noting the industry and many others typically close over the Christmas-New Year period and these would normally be firing up now.

“Tied to the construction industry is a massive amount of jobs,” she said, with downstream effects on all manner of manufacturing from carpets to other furnishings or equipment.

“All of those places have yet to be hit by the same issue,” McManus said. “And that’s around the same time the peak of the infections are meant to be happening.”

Belinda Allen, a senior economist at the Commonwealth Bank, said the November vacancies figures reveal how the labour market “was in a very strong position” pre-Omicron.

“Demand for labour was exceptional, staff shortages could be seen across most industries and the participation rate was already back to its pre-Delta outbreak level,” Allen said in a note.

“It is still early days on the possible impact of the Omicron outbreak on the labour market, but with staff shortages clearly evident, businesses may be reluctant to shed staff if demand slows given the shortages in the labour market,” she said.

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