Hiring intentions in the manufacturing sector are up seven percentage points on this time last year, according to the Manpower Employment Outlook Survey.
The encouraging result comes despite the Australian Industry Group’s Performance of Manufacturing Index reporting a contraction in the sector for the third consecutive month in February.
The survey which asks the hiring intentions of over 1,500 employers in Australia for the coming quarter, found that 19 per cent of employers in the Manufacturing Sector plan to increase hiring, 11 per cent plan to decrease hiring and 69 per cent will make no changes to their hiring plans. The resulting Net Employment Outlook of +5% is up two percentage points quarter-on-quarter.
“Manufacturing scaled back hard in 2009, and the sector has remained volatile since. The positive hiring intention for the coming quarter is likely due to a number of things,” said Lincoln Crawley, Managing Director, ManpowerGroup Australia and New Zealand.
“The low dollar is allowing growth in the export market for manufacturers, as that leads to increased demand many will be looking to hire on a non-permanent basis to account for further activity.”
“There are also regions across the country where we are seeing a high demand for local products – particularly in the food and beverage space, which the Australian Industry Group notes is one of the sector’s growth areas.
The sector is still tentative when it comes to hiring, and in many instances is seeing a rise in temporary and casual positions.
“We are seeing some businesses that contracted a few years ago re-evaluate their workforce planning. These businesses are now bringing on contract workers to fill gaps and look at building efficient workforce models,” Crawley said.
Nationally the outlook for the economy as a whole remains stable, down 1 per cent year-on-year, and unchanged from last quarter.
Crawley said the employment outlook reflects the mixed economic and market signals affecting business confidence.
“Low growth, falling wages and lower consumer confidence coupled with uncertainty about Federal Government leadership is causing many Australian employers to reign in their hiring plans for Quarter 2 or stop them altogether,” he said.
“There are some bright spots. However, we’re not seeing clear signs that hiring activity will gain any additional traction in the next three months, and employers are expecting to contend with another year of certain uncertainty in Australia.”
“We are facing a rising unemployment malaise, with a fluctuating unemployment rate currently sitting around 6.4%. Youth unemployment is double that at 13.2% last month and unemployment is even high for those with tertiary education,” he said.