Dark days across the ditch

Executive search firm EL Consult’s Executive Demand Index fell further two percent in August to its lowest level so far this year. EL Consult’s managing director Grant Montgomery says the outlook for the Australian executive market is trending downwards and this could continue for the next six months

“There is sea of uncertainty out there and no recovery anywhere in sight. The macroeconomic environment is quite concerning. The Australian currency is near post-float highs and most developed economies are continuing to slow. The microeconomic situation is no better. Consumer sentiment is low, housing starts are struggling to get up head of steam, manufacturing is on the nose and retail sales are flat with renewed aversion to debt by consumers.”

Montgomery says while Australia’s GDP numbers remain positive thanks to the mining boom, there are signs that the domestic economy particularly outside mining is on declining curve. “In such an environment we are likely to see further falls in executive demand up to the end of 2011 and into 2012, whereupon we expect to see some signs of recovery in the executive demand market.”

Westpac predicts the overall Aussie jobless rate could hit 5.5 percent by mid-2012 (figures released yesterday showed it sitting at 5.3%) as structural change linked with dour consumer sentiment, high interest rates and the high Australian dollar further dampens domestic demand. The EL Executive Demand index typically leads the general job market by six months, says Montgomery.

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