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Election 2016: The Coalition's employment record isn't that good

Analysis

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Company tax cuts undermine jobs & growth mantra

The Coalition's tax cuts for business will return very little to the Australian economy for the cost to the budget. Age economics editor Peter Martin explains.

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In the Coalition's three years in office, part-time employment grew 306,000 and full-time employment just 150,600.

This long-term hollowing out of employment stands in stark contrast to Labor's six years in which full-time and part-time employment grew in tandem, full-time employment climbing 439,000 and part-time employment 471,000.

The figure emerges as the final Bureau of Statistics labour force update before the election allows an assessment to be made of the kind of jobs that are being created under the mantra of "growth and jobs".

In the Coalition's term, mining employment has fallen by 36,500, manufacturing employment by 13,100, employment in public safety and administration by 31,700 and employment in utilities by 11,600.

Over the same period, employment in real estate has climbed 32,400, employment in finance 5600, employment in healthcare and social assistance 136,400, employment in retailing 86,200, in construction 25,500 and in professional, scientific and technical services 110,000.

Westpac economist Justin Smirk says the shift toward part-time employment is likely to be more about the sectors that were expanding and contracting than work patterns. "This can be seen in employment by gender with female employment rising 141,000 in the year compared to 83,800 for male employment."

The employment-to-adult-population ratio is unchanged from the Coalition's election in September 2013 after at first continuing to fall as it had under Labor, then rising, then falling again since November 2015.

The unemployment rate is steady at 5.7 per cent, exactly the rate the Coalition inherited in 2013. In the first half of the Coalition's term, it climbed to a peak of 6.2 per cent in January and February 2015, before falling to 5.7 per cent in late 2015.

Full-time employment has been sliding since December, slipping by 60,670 in the first five months of the year.

"Australia is becoming a part-time employer, and that signals badly for the quality of work," says Bill Mitchell, director of the Centre of Full Employment and Equity at the University of Newcastle. "Trend growth is slowly receding to zero."

In trend terms, employment grew just 3700 in May while Australia's working age population grew 9000. Employment is climbing in NSW and Victoria, and falling in the rest of the nation.

NSW enjoys the lowest unemployment rate of 5.2 per cent, Victoria and Western Australia are on 5.7 per cent and Queensland, Tasmania and South Australia are above 6 per cent – on 6.4 per cent, 6.5 per cent and 6.9 per cent respectively.

Peter Martin is economics editor of The Age.

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