Economy Cools As Jobs Rise

Newcastle Herald

Saturday July 31, 2004

By GREG WENDT Business Editor

ABOUT 40,000 jobs have been created in the Hunter Region since May 2002, according to the Hunter Valley Research Foundation.

But 20,000 people are still in search of work, as figures released yesterday showed.

Foundation senior economist Robin Mcdonald said 67 per cent of the jobs created were full-time.

The foundation said the rate of employment growth in the region over the past two financial years had exceeded the long-term trend.

In June 2004, 269,000 people were employed, compared with 229,000 in May 2002 an increase of 40,000 jobs.

Ms Mcdonald said the unemployment rate in the Hunter was still high, but "relatively speaking" it was not as high as it had been in 2001-02 when it was higher than the state average.

"More people in the labour market are looking for work, and there has been a protracted decline in the Hunter's unemployment rate," she said.

A record number of people were working in the region in the quarter ended June and participation in the labour force had reached new highs.

Ms Mcdonald said the unemployment rate stayed below 10 per cent for the whole of 2003-04, with the gap between the state and regional rates falling from between four and five percentage points to one and two percentage points.

About 20,000 people were seeking work.

In addition, growth in part-time employment has exceeded full-time employment growth.

Economic activity in the Hunter had passed its peak and was showing signs of slowing, but the outlook for the region was still good.

The global economy, which affects exports in the Hunter, is strong and economists are confident the momentum in the region's mining, manufacturing and export sectors will accelerate when the Australian dollar falls, possibly as low as 64 cents.

National Australia Bank chief economist Alan Oster told a meeting of more than 300 business leaders in Newcastle yesterday that as an exporter of coal and machinery that was good news for the region.

The research foundation hosted a business breakfast to deliver the latest economic update and key indicators for business and investment in the next quarter.

Ms Mcdonald said economic activity in the Hunter was expected to "ease not squeeze" businesses and households.

Following the surge in business confidence and consumer spending in the region, which reached a peak in the last quarter of 2003, the regional economy was showing the first indications that it was cooling.

© 2004 Newcastle Herald

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