McKinsey report: The current state of the US job market. What does that mean for Australia?

I recently read a blog discussing the McKinsey report on the state of the US job market.  In what was an interesting piece, the blog painted a pretty grim picture of the US job market and raised valid arguments supporting the view that the market may not improve for some time.

Whilst some of the arguments are US centric, I believe others are as relevant here in Australia as anywhere in the world.  As organisations look to bounce back from the tough times experienced over the past three years, it’s important to be aware of the ramifications recent decisions made by Government will have on local businesses.  Additionally, we need to be cognizant of the effects the globalised economy will have on our local job market.

A point made in both the McKinsey report and the BNET blog written by Alain Sherter is that the increase of automation and offshoring will result in a paradigm shift towards part time and contract roles over full time employment.  This is a point that rings as true in Australia as it does in the rest of the world.  With new legislation passed by Fair Work Australia in recent days cutting the minimum shift lengths to one and a half hours, coupled with an increase in the automation in retail such as self checkouts, there is a definite shift which will see less opportunities for full time employees within trades such as retail and more emphasis on cost cutting to maximise profits.  This issue is obviously two sided and the advantages of lowering the minimum shift length are both short and long term – the opportunity for young people to gain valuable work experience will have positive ramifications for their generation both now and in the future – but we need to be mindful of the repercussions on the present job market and how it effects unemployment rates.

On top of this, the rise of online purchasing and the growth of the global marketplace have seen more jobs move overseas and less opportunities in Australia within industries such as telecommunications, retail and IT.  Whilst our economy is still very good, in large part due to the resources sector in Australia, it is still important to be mindful of the decline in available roles within these sectors and how we can accommodate professionals with career experience in these markets.

All in all, it seems the Australian market is in a lot better shape than the US.  That being said, it is essential for the benefit of our long term economy that the creation of jobs and/or training programs to accommodate our growing population, and in turn assist in the continual growth of our economy, be an absolute priority.