NDIS hiring generates job growth

The surge in employment this year owes more to the ramp up of the NDIS than to any broad recovery in the economy

The surge in employment this year owes more to the ramp up of the National Disability Insurance Scheme than to any broad recovery in the health of the economy.

An analysis by economists and JPMorgan shows that virtually all the rise in employment growth this year is accounted for by women in the healthcare sector, with the NDIS by far the largest employer.

The government has been buoyed by a 325,000 increase in total employment over the past year. Malcolm Turnbull said the latest jobs figures showed “our commitment to jobs and growth is not a slogan, it’s an outcome”.

JPMorgan economists Ben Jarman and Tom Kennedy say there have been starkly different trends in employment for men and women. The share of women of working age who either have a job or are looking for one has risen from 58.5 per cent in 2014 to 60 per cent now, while the share of men participating in the workforce has continued a long drift down from 72.5 per cent a decade ago to 70.5 per cent now.

The Australian Bureau of Statistics jobs survey shows that healthcare has been the biggest source of extra employment. Excluding the rise in jobs in healthcare, employment growth over the past 12 months was almost identical to the previous year.

The economists note that the government estimates the NDIS will generate demand for care providers, rising from 73,000 in 2013 to 163,000 full-time-equivalent positions by 2020.

Many of these jobs are part-time, so total recruitment will be much higher. More than 40 per cent of healthcare employment is part-time.

Many carers receiving a government benefit or payment will switch to employment status with the NDIS. “It is hard to be precise on labour supply implications, but there are more than 2.5 million informal caregivers in Australia, the bulk of whom are women, so it is likely the introduction of the NDIS has been influential in driving female participation higher,” the study says.

The study notes that the increase in employment in healthcare became evident in NSW first, followed by Victoria and Queensland and says this matches the profile of the NDIS rollout across the states.

Although there is no question that NDIS jobs are “real”, as are healthcare jobs generally, the growth in employment in this sector does not indicate broader strength in the economy.

The “bellwether” sectors, which are closely related to the overall level of unemployment, are manufacturing, retail, construction, real estate and administrative support.

Of these, only construction is doing particularly well.