Tuesday 14th June 2016 - 12:34 pm

A steady recovery:but where are the jobs?

by Alan Thornhill

The Australian economy – outside mining -is continuing to show signs of a steady recovery – as the July 2 elections approach, according to a new survey.


The National Australia’s monthly business survey for May, which has just been published, cautioned, though, that the full impact of this improvement is not yet showing up in the nation’s job market.

The bank’s Chief Economist, Alan Oster, said: “the Survey is suggesting further improvement for the non-mining sectors going into Q2, with some evidence that growth is becoming more broad-based”.


Mr Oster said business conditions had remained strong   strong on the activity side.

However he added “…firms continue to be relatively restrained in terms of their demand for labour”.
“But most industries did record an improvement in business conditions for May.

“Service industries continue to lead the way, which now includes distributional services such as retail.

“But mining and construction remain quite weak.

Mr Oster said this was”partly a reflection of the ongoing downturn in spending on resource projects”  Mr Oster added.


However, he noted too, that: “despite elevated business conditions, firms are reporting slightly lower levels of confidence.


The confidence index eased 2 points to +3 index points in May, pushing the index further below its long-run average.


And he added: “the RBA’s cut to interest rates did not help lift business confidence as we had hoped, even as sales activity continues to improve”.
He said, though, that “uncertainty around the upcoming election might be a factor here, but mixed results across industries suggest that other factors are at play”.

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Alan Thornhill

Alan Thornhill is a parliamentary press gallery journalist.
Private Briefing is updated daily with Australian personal finance news, analysis, and commentary.

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