National Australia Bank (NAB) Chief Executive Cameron Clyne is not intimidated by Goldman Sachs economist's statement that Australia might have a 20 per cent chance of going into recession in 2014. The NAB chief executive is confident due to the low employment rate which will serve as a buffer against recession.
Treasurer Wayne Swan criticised Australian media and Goldman Sachs for intentionally endangering economic stability by highlighting the threat of recession. Clyne had already said that Australia remains overly pessimistic about the economy. A similar forecast in the United States would have been a reason to celebrate if given an 80 per cent chance of avoiding recession.
Clyne said that Australia seems to be in a state of national gloom. Despite low business confidence in the country, house prices were doing fine and consumer outlook remains positive. A little bit of concern is understandable for job security.
Employment uncertainty an issue
The unemployment rate is currently pegged at 5.5 per cent. However, figures show that 7 per cent of Australian part-time workers are willing to work more hours.
Data shows that 35 per cent of the total Australian labor force is employed on a contractual basis. Economist at AMP Capital Shane Oliver said that the given figures may be too high. Contractual work for a long period may be limiting the workforce and can prove to be debilitating.
Labor unions have aired a television commercial recently to express their concerns about the job market. According to Ged Kearney, president of the Australian Council of Trade Unions, the trend of hiring more workers on a contractual basis have already cost workers certain entitlements.
Kearney said a contractual worker does not get sick leave, annual leave and carers leave. Contractual workers also lose the benefit of superannuation which makes it more difficult to obtain a loan.