The latest report on executive demand from recruitment firm EL Consult revels that the ICT sector recorded the best result of all sectors in April, with the support coming from New South Wales, Western Australia and Queensland.
For the month, all states except for Tasmania, South Australia and the Northern Territory, saw a rise in executive demand in ICT.
“Along with many other sectors, ICT has now put in a third straight quarter of gains. This is significant and a positive sign for investment in this sector as for some years it has been very sawtooth, with rises and falls alternating monthly,” says EL consult managing director Grant Montgomery.
The EL Index is up approximately 23% since December, and is up 36% since April 2016, which EL says indicates a growing economy and higher corporate and consumer sentiment.
Montgomery says a picture of solid economic growth is emerging, with the further 16% rise in job vacancies for executives confirmed a continuing upward trend across all business and industry sectors.
According to Montgomery, Australia is possibly seeing an economic revival driven by the middle class.
“Executive jobs are plentiful and there is accelerating consumer demand for credit, corporations are taking advantage of low interest rates to finance capital investment and the government is indulging in more and more infrastructure programmes.
“After significant falls in 2011 and 2012 due to the delayed effects of the GFC, a recovery in executive demand is very welcome.
“Interest rates in Australia, the US, Europe and Japan are still at record lows. With improving confidence levels, companies are jumping on these rates to lock in investment programmes that are likely to last many years.
“For example, some US companies are locking in rates at 2% over 20 to 30 years. In Europe, mortgages can be had for 2% — fixed — over a 30-year period. With economies globally no longer seen as black holes that will never recover, these rates look extremely good value for money.”
On the infrastructure side, Montgomery notes that the Australian Government is committed to spending and “good or bad debt aside, has a hit list of projects including new train lines, an airport and a $2 billion enhancement to the Snowy Hydroelectric scheme to stave off Australia’s looming power crisis”.
“The last three months of record overall increases in job demand this will eventually translate into much stronger growth for the Australian economy.
“It is our considered opinion that economic growth could be breaking through 3% by 2018.”
But, on official interest rates, Montgomery says stronger economic growth is not necessarily good news for rates, which “also have a chance of rising in the latter half of the year particularly if the expanding job market results in considerable wage and salary growth”.
“But whatever way you look at it the trend in economic activity is clearly upward and this is good thing,” Montgomery said.
“As seen last month there was a small short-term reversion in jobs in March but this did little to soften the obvious upward trend confirmed again this month."
The gains this month were substantial across most states and territories.
“We have seen good quality gains across the sectors and states – the only area to fall was Tasmania.”
Montgomery says the ACT and Western Australia picked up considerably.
“Although the market for iron ore is quite volatile engineering demand in Western Australia can be linked to a revival in the resources sector there. It is a similar story in Queensland.
“Overall, NSW is the largest employer and now represents approximately half the overall demand for new executive positions.”
“Although the amount of raw positions is less in the ACT and the Northern Territory, for their small populations they are actually growing strongly in relative terms and Victoria is not far behind NSW when considered on a population-adjusted basis.”