Jobs churn at decade-high as one in ten workers switch employers

New figures show working Australians having been taking full advantage of the opportunities offered in a red-hot jobs market.

Australians have enjoyed a plethora of job opportunities over the past year. Picture: NCA NewsWire/Jeremy Piper

The level of labour market churn is at its highest in a decade, with one in 10 workers taking advantage of a red-hot market and switching jobs over the past year.

As employers have scrambled to secure workers and keep hold of the staff they have, the rate of retrenchment dropped to a 50-year low of 1.4 per cent, Australian Bureau of Statistics figures reveal.

The annual job mobility ­figures ­confirm a frantic two-year period of hiring in the wake of the Covid lockdowns, with businesses still battling with labour shortages as 1.3 million workers switched jobs.

ABS head of labour statistics Bjorn Jarvis said the past two years had only partially reversed a downward trend that reached a nadir at the height of the pandemic. “Job mobility in Australia has generally been trending down for decades and reached a record low of 7.5 per cent during the first year of the Covid-19 pandemic,” he said.

“While the 2023 figure might be higher, and is in fact the highest it’s been since the early 2010s, it’s still relatively low compared to earlier decades.”

Of the people that changed jobs, the highest proportion, 13 per cent, went to take health care and social assistance roles, followed by construction and professional scientific and technical services, at 10 per cent each, the ABS data shows.

It also shows that almost one in five people who started the year in hospitality changed jobs, either within hospitality or to another industry.

“Over the year, 37 per cent of people changed to a job with the same usual hours, while 33 per cent changed to a job with more hours, and only 30 per cent changed to a job with fewer hours,” Mr Jarvis said.

The ABS figures also showed that of the 13.8 million people employed in February, over half, or 56 per cent, had been employed in their current job for less than five years. About one in five had been in their job for less than one year, while one in 10 had been with their employer for 20 years or more.

Wages have begun to push higher but have grown far less quickly than inflation, which hit 30-year highs in December and remains high. Economists expect demand for labour to ease as soaring borrowing costs and high cost of living drag on spending and the economy more broadly.

ANZ senior economist Adelaide Timbrell said the deadening impact of a dozen Reserve Bank rate hikes in a little over a year was yet to become obvious in the jobs numbers. Ms Timbrell noted the number of job vacancies fell by just 9000 in the three months to May, despite employment growth of 143,000 over the same period. With this in mind, the RBA board would shrug off this week’s soft inflation data and increase its cash rate target to 4.35 per cent on Tuesday.

The RBA predicts unemployment will climb to 4.5 per cent by mid-2024.