Canberra job market forecast to slow

While the ACT is set to finish the financial year strong with 2700 more workers (3.5 per cent growth), forecaster Deloitte Access Economics predicts the territory's employment growth will slow to just 0.1 per cent in 2024-25

Employment in the national capital took a hit at the end of 2023, as the number of employed people fell by about 2000 workers in the three months to December, and the labour force dropped by 0.9 per cent - the equal largest fall in Australia.

The impending slowdown will be felt more in certain parts of the local economy, according to Deloitte.

The report forecasts the drop will be most notable in the public administration sector, where employment is expected to decline by 410 workers, or 0.9 per cent. Despite this, some growth is anticipated in the white collar workforce, especially the professional services and financial services industries.

Meanwhile, Canberra's accommodation and food services sector should brace for a 1.7 per cent drop in employment.

The deceleration in job gains reflects the overall trends Australians will see across the country, according to the report's lead author, David Rumbens, who predicts national employment growth to slow to 133,400 jobs (0.9 per cent) in the coming financial year.

"The year ended on a softer note with employment falling by 65,100 people in the month of December 2023," Mr Rumbens said.

"That was the largest monthly decline since September 2021 - a month affected by pandemic lock downs."

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January had just a 500-person lift in employment. Job vacancies have also continued to fall across the country - confirming a "turning point" in the economy - as broader conditions have forced employers to reconsider their workforces.

"The cost-of-living crisis has meant that consumer spending has been dialled right back, and many businesses are now following suit - reducing their new hires and/or shedding some staff," the report said.

It noted that there are 65,300 fewer vacant positions than there were a year ago - a drop of 14.4 per cent.

The unemployment rate is also expected to increase to 4.5 per cent by the end of the 2024 calendar year, meaning an additional 108,4000 will become unemployed.