Public Sector employment data shows the fiscal principle still not being met…and the Govt appear to want to move the goal posts

The release of the December quarter Public Sector work force data (which was released over the weekend) shows (again) that the Government’s fiscal principle of keeping full-time equivalent Public Sector employment growth to that of population growth has not been met. FTE growth in the year to Dec 2018 was +3.0%, well above the forecast pace of population growth, but was the slowest pace of growth since the Sept 2017 quarter. Indeed, over the quarter there was a reduction in both FTE and Headcount…while much is being made of this in some media we should only concern ourselves with the year-on-year comparisons given the highly seasonal nature of many Public Sector positions.

When we consider FTE on the annual basis we see that growth in the Dept of Education remains elevated at 4.6% while the Dept of Health sees growth of 4.1%. Some months ago we were interviewed on ABS Radio Brisbane where we noted that the fiscal principle is badly set; it includes the areas of health (which makes up almost 40% of all public sector employment) where employment growth is (largely) outside of the control of the Government, unless they wish to make decisions to restrict health provision to a population making ever greater demands on the health service.

It is certainly worth noting that the press release from the Premier (here) claims that “the Palaszczuk Government continues to honour its commitment to the fiscal principle of growing frontline services in line with population growth“. Actually the principle makes no mention of “frontline services” but rather talks about “full-time equivalents (FTE) employees, on average over the forward estimates“. Does this suggest that the Government have recognised the fact that the principle, as drafted, makes little sense and are now trying to move the goalposts after the match has started? Since the Palaszczk Government came to power in March 2015 the Queensland population has grown by about 6% and yet Public Sector FTEs are up almost twice that, a shade under 12%. To suggest in anyway that this “continues to honour” the fiscal principle is clearly ridiculous.

Equally ridiculous is the suggestion that the increases in Public Sector employment are responsible for all the improvement in the labour market in Queensland. In the year to Dec 2018 Trend employment in Queensland was up by 28,800. Public Sector headcount increased by 7,572 in the same period; in other words increases in Public Sector employment made up 26% of the total. When the Palaszczuk Government came to power the Public Sector made up 10.33% of total employment, by Sept 2016 that percentage had increased to 10.84% and it has been in a range between that and 10.58% since. Currently it sits at 10.76%.

Public Sector employment growth is certainly a contributing factor in total employment growth, but to suggest that it is somehow the main driver simply doesn’t hold up under scrutiny.

The data for Dec also allows us to take a look at the distribution of Public Sector FTEs throughout the State. In the year to Dec FTE growth in Greater Brisbane was 3.2%, in the Rest of Queensland it was just 2.8%. However since the ALP government came to power FTE growth in Greater Brisbane (+11.5%) has trailed that in the Rest of QLD (+12.4%)

Since March 2015 Cairns has grown at close to the regional average up 12.1% while Townsville has seen just 8.1% growth in that time.

While the Government have talked about supporting jobs in regional Queensland, and certainly some programs appear to have done that, this data suggests that when it came to their own direct hiring they have actually stimulated very little extra direct employment in the regions. If FTE growth in the regions had been at the same pace as in Greater Brisbane there would have been only 886 fewer FTEs across the regions than we currently have. However, what is clear is that much of the regional growth has been restricted to the Gold and Sunshine Coasts where growth rates have been well in excess of average. Indeed if we exclude the SEQ regions of the Sunshine and Gold Coasts then Public Sector FTE growth in regional Queensland shrinks to just 8.6% since Mar 2015, well below the pace in the SE corner (13.7%).

Dec-18 Dec-17 % Mar-15 %
 FTE  FTE  y/y  FTE  since Mar 15
Brisbane – East 5,037 4,795 5.0 4,537 11.0
Brisbane – North 9,627 9,384 2.6 8,254 16.6
Brisbane – South 18,048 18,702 -3.5 17,859 1.1
Brisbane – West 3,671 3,542 3.6 3,263 12.5
Brisbane Inner City 45,252 43,487 4.1 40,536 11.6
Ipswich  14,959 14,003 6.8 12,740 17.4
Logan – Beaudesert  10,677 10,198 4.7 9,352 14.2
Moreton Bay – North    9,100 8,881 2.5 8,017 13.5
Moreton Bay – South    3,578 3,289 8.8 2,974 20.3
Greater Brisbane 119,947 116,280 3.2 107,533 11.5
Cairns 13,388 13,035 2.7 11,946 12.1
Fitzroy 9,884 9,666 2.3 9,146 8.1
Darling Downs – Maranoa 4,992 4,941 1.0 4,782 4.4
Gold Coast 19,396 18,555 4.5 16,014 21.1
Mackay 6,512 6,423 1.4 5,893 10.5
Queensland – Outback 6,148 5,968 3.0 5,950 3.3
Sunshine Coast 12,888 12,502 3.1 10,376 24.2
Toowoomba 7,661 7,420 3.3 6,781 13.0
Townsville 12,868 12,561 2.5 11,903 8.1
Wide Bay 11,790 11,599 1.6 11,055 6.6
ROQ   105,525 102,669 2.8 93,847 12.4
QLD   225,472 218,949 3.0 201,379 12.0

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