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Unemployment rate hiding workforce shift

Unemployment rate hiding workforce shift

Job, jump, leap

While attention has been focused on Australia’s relatively stable unemployment rate, an underlying shift has emerged of workers leaving SMEs in favour of larger businesses.

According to figures from the Australian Bureau of Statistics, the number of employees in large organisations has steadily climbed between the 2009 and 2016 financial years (save for a small blip in fiscal year 2014), increasing from 2.92 million to 3.458 million.

However the same pattern of growth is not evident among SMEs.

Small businesses saw a decline in 2016 compared with a year earlier, falling by 800,000 to 4.731 million, with the figure reaching its peak back in 2011.

As would be expected, the statistics have been most volatile for small businesses, but the overall figure has stayed between 4.556 million and 4.781 million throughout the period.

Most pronounced, however, was a continual decline in the number of employees working for medium-sized businesses.

Every year since its peak of 2.734 million in fiscal year 2012, medium businesses have shed staff. By 2016, that number had fallen to 2.489 million.

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The end result is that large businesses have increased their share of national employment, accounting for 32.4 per cent of all workers, compared with 31 per cent in 2012.

Mid-sized firms have gone the other way, falling from more than a quarter (25.6 per cent) of Australia’s workforce to 23.3 per cent.

Small businesses continue to be the nation’s largest employer, at 44.3 per cent of the workforce.

The shifting workforce pattern appears at odds with the mass job losses we have become accustomed to hearing from the corporate sector, such as the reports earlier this year that the four major banks would collectively shed around 20,000 jobs.

As of April 2018, Australia's unemployment rate remained steady at 5.5 per cent.

Unemployment rate hiding workforce shift
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