CONTINGENT JOB INDEX Quarterly

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1 CONTINGENT JOB INDEX Quarterly December 2017

2 About Kinetic Super Kinetic Super is the industry fund that s passionate about keeping people connected to their super. For over 25 years, Kinetic Super has worked throughout Australia across various industry sectors. Today, Kinetic Super manages in excess of $3billion in retirement savings and operates for the benefit of over 250,000 members. With low fees, a history of strong long-term investment performance, a range of investments and great value insurance, Kinetic Super is committed to providing quality products and services. Kinetic Super challenges attitudes towards super and helps people bring the same energy and control they have for their life, to their super. Kinetic Super the super that moves with you. Contents Methodology 3 PART THREE: Industry Analysis 8 PART ONE: National 4 PART FOUR Regional and State Analysis 10 PART TWO: Occupational Analysis 5 State and Territory Specific Analysis 11 2 December 2017 Contingent

Methodology The Kinetic Super Contingent measures and tracks advertised vacancies in digital advertisements on job boards, employer career portals and recruitment company web sites.

The change in demand for contingent employment opportunities (temporary, contract and casual) is then calculated over 12 months and each quarter.

3 Methodology The Kinetic Super Contingent measures and tracks advertised vacancies in digital advertisements on job boards, employer career portals and recruitment company web sites. Measurement of vacancies is critical because it is a lead indicator of what is likely to happen in employment in the future. The change in demand for contingent employment opportunities (temporary, contract and casual) is then calculated over 12 months and each quarter. We also measure the proportion of contingent job opportunities as a percentage of all job advertisements (e.g. contingent plus permanent). Our methodology is to extract job advertisements in real time over the internet 24/7. Our research covers around 4,000 sources in Australia on a continuous basis. Advertisements are de-duplicated twice once to eliminate any advertisement run on the same source in the last 30 days and secondly to eliminate an advertisement already extracted from an alternative source. The Kinetic Super Contingent starts at a baseline of.00 in November Temporary, contract and casual jobs 56 % VACANCIES ADVERTISED NATIONALLY Since November % UNPRECEDENTED QUARTERLY INCREASE IN CONTINGENT BLUE COLLAR JOBS 83 % PUBLIC SECTOR LEADS THE FIELD Since November 2013 December 2017 Contingent 3

4 PART ONE National 56 % National increase in advertised contingent jobs since Nov 2013 Appetite for temporary, contract and casual workers has remained voracious this quarter, with the Kinetic Super Contingent seeing numerous record high figures regarding numbers of contingent jobs advertised nationally and State-wide and as a percentage share of all advertised jobs, across multiple industries and occupations. The Kinetic Super Contingent rose by a robust 6.6% this quarter alone. The National Index is now at a new record high of This equates to a 55% increase in the number of contingent jobs advertised nationally since Index data commenced in November This quarter saw three consecutive increases, with each month exceeding the prior monthly record. The Contingent is now an impressive 14.4% higher than 12 months ago and a significant 28.6% higher than two years ago. Typically, the contingent job market tends to slow down or decline in December each year, however 2017 s employment market is stronger than the previous five years so December 2017 could spring a surprise. National % Proportion of contingent job advertisements 35% National 30% 25% 20% 15% 10% 5% 0% CHART 1 National Contingent Proportion of national contingent jobs versus permanent The proportion of job advertisements for contingent employment arrangements rose a further 0.8% for the quarter reaching 28.5% in November. Demand rose for permanent staff each month during the quarter but the larger rise in demand for contingent staffing solutions drove the rise in the National Contingent Job Share. The Contingent Job Share is 1.2% higher than a year ago and a massive 4.3% higher than two years ago. The current Contingent Job Share of 28.5% is close to the record high of 28.7% which we saw in January and May 2017, however the Christmas period may well push back matching or exceeding the record to later in CHART 2 National proportion of contingent job opportunities relative to all job advertisements 4 December 2017 Contingent

5 PART TWO Occupational Analysis The Blue Collar Contingent continues to grow strongly. In the last quarter the Index scaled new heights achieving a record high of That s a 13.3% rise in the last quarter alone. Some of this is seasonal but some structural too. It s also seen an annual rise of 20.2%. The White Collar Contingent Job Index is also rising but, at 4.9% in the last quarter, not as fast. As White Collar includes retail sales work a fair proportion of this will be seasonal. The annual rise of 13.0% is less impressive than Blue Collar but its Index is also on a new record level of , so performing strongly in its own right Blue Collar White Collar 13.3 % Unprecedented quarterly rise in Blue Collar contingent jobs CHART 3 Contingent High Level Occupational Analysis Contingent jobs by occupation In November, the White Collar Contingent Job Share hit 29.6% equalling the highest proportion achieved in May, earlier this year. This ratio has actually increased by 2.0% in the last twelve months. Over the same period the Blue Collar Contingent Job Share has fallen 1.1%. This is very surprising. It peaked at 28.2% last August and has drifted down since then. It has recovered 1.0% in the last quarter. This is a consequence of the massive 13.3% rise in blue collar vacancies Blue Collar White Collar 29.6 % White Collar 70.4 % Blue Collar CHART 4 Contingent Job Share High Level Occupational Analysis December 2017 Contingent 5

6 192.7 Contingent Sales Jobs Index reached a record high this quarter The Sales Contingent peaked on in October, a record high in four years of research. It has since slipped back 4.8% as seasonal demand eases. Interestingly Clerical contingent hiring has slipped in the last six months (6.6%) and 3.8% in the November quarter. It is the only occupational group to have fallen in either period. The Clerical Contingent is still up 15.6% year on year, above the national average, but surprisingly lacklustre given the general strength of the employment market. The Professional Contingent is progressing well. Job opportunities rose by 6.5% last quarter and 14.6% since last November. The Index rose above 150 for the first time in November. Growth is steady rather than spectacular. Contingent employment at the Executive level seems to be finally taking off. It picked up a staggering 10.8% in three months, reversing the weak start to the year. The Executive Index is the lowest white collar occupation, on , but three successive months of growth indicates a more positive recent trend. Clerical Executive Professionals Sales CHART 5 Contingent by White Collar Occupation All forms of Blue Collar Occupation enjoyed positive improvement in job prospects in the November quarter. It has been a particularly strong year for casual, temporary and contract roles for technicians and trades with vacancies up a massive 38.5% over twelve months. It s been a Bull Run of record rises every month (except June) In October Labourers became the first Contingent to break the 200 mark! Things plateaued in November but still rose 11.2% in the quarter. Demand for Machinery Operators and Drivers shot up an impressive 16.8% in the last quarter to establish a record high Index of This more than makes up for a slow start to the year. 6 December 2017 Contingent

7 Community and Personal Services Labourers Machinery Operators and Drivers Technicians and Tradies % Unprecedented annual rise in Technicians and Tradies contingent roles CHART 6 Contingent by Blue Collar Occupation We are now able to provide four years of historical data. Since November 2013 the average national increase in Contingent Job Share was 5.0%. The over performers were Clerical (6.6%) and Professional (6.4%). Community and Personal Services grew by only 0.9%. These two also dominate in share. Clerical is now 33.9% (ironically actually down on its record share of 34.6%) and Professional at 31.9%. Professional includes many Information and Communication Technology (ICT) roles, an area historically characterised by a high level of contract fixed term employment. Sales roles have always had the lowest concentration of contingent job opportunities but even this has risen by 5.2% in four years. It remains well behind on 17.1%. Amongst the blue collar occupations growth has been far more subdued. This can be attributed to particular strength in permanent employment rather than a dearth in contingent work! 40% November 2013 November 2014 November 2015 November 2016 November % 20% 10% Clerical and Professional jobs have seen the highest growth in contingent opportunities 0% Clerical Community and Personal Services Labourers Machinery Operators and Drivers Executive Professionals Sales Technicians and Tradies CHART 7 All Occupations proportion of Contingent job opportunities relative to all job advertisements December 2017 Contingent 7

8 PART THREE Industry Analysis 19.3 % Public Sector leads the charge in contingent jobs by industry in the last quarter The Public Sector Contingent continues to lead the field. Already at record levels it still managed to rise a further 19.3% in the last quarter. The Index sits on The November quarter also saw a surprise recovery in Education and Training. Demand rose by 10.1% for the year. The market is at a record level high of , but the path is very erratic. It s also hard to pinpoint specific causes for a weak quarter in Healthcare and Social Welfare. Employers may be countering the trend and favouring permanent employment! Likewise, the bull run enjoyed by Professional Services (including ICT) could not be maintained and it fell back 3.6% in the last quarter. It is still a very healthy 26.7% higher than twelve months ago. Professional Services (incl. ICT) Health Care and Social Welfare Public Sector Education and Training CHART 8 Contingent by select industries (1) Every year demand in Retail and Wholesale ramps up. This year it has ramped up faster than ever (a response to Amazon?) to 22.3% in the last three months alone. The Index peaked on and has since, as anticipated, retreated in November. Contingent job opportunities in Mining, Construction and Utilities have been very strong this year, up 43.2% compared to November 2016 although this has levelled off in recent months. Financial Service employers are readjusting their staffing mix with further structural change in demand patterns. Demand for contingent staff has grown the fastest in the last 12 months has expanded by 47.8%. 200 Financial and Insurance Services Mining, Construction and Utilities Manufacturing and Supply Chain Retail and Wholesale % Huge quarterly rise in contingent Retail and Wholesale jobs 50 CHART 9 Contingent by select industries (2) 8 December 2017 Contingent

9 Contingent job share by industry Again, we now have four years of data. This is a unique insight into the growth in contingent workforces. The most consistent increase has been in Mining, Construction and Utilities. This has grown by 7.5% to 34.3% over four years, 2.9% in the last twelve months. These are industries that have always had a strong emphasis on casual and contract employment. 50% 40% November 2013 November 2014 November 2015 November 2016 November % Education and Training has the highest proportion of contingent jobs 30% 20% 10% 0% Professional Services (incl. ICT) Public Sector Health Care and Social Welfare Education and Training Financial and Insurance Services Manufacturing and Supply Chain Retail and Wholesale Mining, Construction and Utilities Other CHART 10 Industries proportion of contingent job opportunities relative to all job advertisements The lowest Contingent Job Share (based on website advertising), at 12.7%, is Retail and Wholesale. It is acknowledged that a lot of employment in retail is casual. While larger chains will use on line for management roles and volume campaigns, smaller employers still find staff through traditional means such as notices in shop fronts! The fastest growth over the last four years is Financial and Insurance Services, rising 7.7% but the current share of 20.2% is only just ahead of Retail and Wholesale lags all other industries. The Contingent Job Share for Education and Training has raised the bar once more. It is now at 44.1%, picking up a further 2.4% in the last twelve months. It remains the industry with the highest adoption of contingent workforce solutions with many teaching roles on fixed term contract arrangements. The Public Sector is the second highest on 36.0%, rising 3.4% this year alone. December 2017 Contingent 9

10 PART FOUR Regional and State Analysis 20.1 % SA/NT dominate in demand for contingent workers It is interesting that regional trends are easier to see than other analysis. SA/NT has always been towards the top but in the last quarter it raced away with a 20.1% rise against a national average of 6.6%. The other notable performer in the last quarter is Western Australia. It rose 12.9%. It has also picked up by a staggering 49.8% in the last year albeit from a pretty low base. This trend fits in nicely with the previously mentioned growth in Mining, Construction and Utilities. Whilst still lagging, Queensland has seen consistent improvement all year. It has enjoyed a rise in contingent job opportunities of 33.1% but only exceeded its starting point in November 2013 in July and, since then, demand has flattened. Strangely the larger states have seen less spectacular contingent growth all year! NSW/ACT has risen just 8.5% and VIC/TAS only 5.3%. These are the states (excluding Tasmania) that have some of the lowest levels of unemployment. Employers may be opting for permanent job offers where talent becomes harder to find. Despite some softness in the market of late the NSW/ACT Index is holding up on a record level of VIC/TAS, on is also near to its highest point. NSW/ACT QLD SA/NT VIC/TAS WA CHART 11 Contingent by region State/Territory analysis 37.1 % ACT continues to have the highest proportion of contingent job opportunities versus any other state/territory The highest Contingent Job Share is now ACT with 37.1% of all job advertisements contingent in nature. This is consistent with the high level of public sector jobs being temporary or fixed term contract. South Australia has slipped to third spot because its share has fallen 2.9% to 34.7%. Over the four years NSW has seen a surprisingly strong 8.0% rise in contingent job share. But, as indicated above, a tighter job market has led to little or no growth in the last six months. It is a very similar story in Western Australia. Contingent has grown by 7.2% in four years. The difference is that growth this year was 4.8% so the trend is still up. The Northern Territory demonstrates the most steady growth in contingent employment. Now over one third of vacancies (35.5%) are contingent, second only to the ACT. 40% November 2013 November 2014 November 2015 November 2016 November % 20% 10% 0% ACT NSW NT QLD SA TAS VIC WA CHART 12 State and Territory proportion of contingent job opportunities relative to all job advertisements 10 December 2017 Contingent

State and Territory Specific Analysis Western Australia Staggering 49.8% increase in advertised contingent jobs in the last year, with a significant 12.9% rise in the last quarter alone.

11 State and Territory Specific Analysis Western Australia Staggering 49.8% increase in advertised contingent jobs in the last year, with a significant 12.9% rise in the last quarter alone. Northern Territory Continued steady growth in contingent jobs with 35.5% of advertised NT jobs now contingent. Queensland 33.1% growth year on year although this rate of increase has slowed considerably. New South Wales Little or no growth in contingent job opportunities this quarter. South Australia Growth of 22.6% in the last quarter has made up for otherwise sluggish growth in Victoria The Victorian market has also been relatively static with just 5.7% growth year on year. Tasmania The Tasmanian contingent job market has been weak, contracting by 5.2%. Australian Capital Territory Continues to dominate with the highest proportion of contingent job opportunities. December 2017 Contingent 11

12 For more information please contact Kinetic Superannuation Ltd (KSL) (ABN AFSL RSE L ) is the Trustee of Kinetic Superannuation Fund (KSF) (ABN RSE R0429) which includes Kinetic Smart Pension (KSP). This information is of a general nature only and does not take into account your personal objectives, financial situation or needs. Before making a decision about Kinetic Super or Kinetic Smart Pension you should obtain and consider the relevant Product Disclosure Statement (PDS) for these products, and any Incorporated Information, and also consider your personal circumstances. For a copy of the PDS, call us on or visit the Kinetic Super website, kineticsuper.com.au. Kinetic Super Contingent HRO2 Research Pty Ltd. The Contingent is produced under licence from the research house HRO2 Research Pty Ltd. Kinetic Superannuation Ltd accepts no liability for its accuracy and opinions. Ratings and awards are just one factor to consider when choosing a super fund. For further information about the methodology used by Chant West, see SuperRatings does not issue, sell, guarantee or underwrite this product. Go to for details of its ratings criteria.

CONTINGENT JOB INDEX Quarterly

CONTINGENT JOB INDEX Quarterly September 2017 Introduction Welcome to the first quarterly Kinetic Super Contingent Job Index. The aim of the Index is to help our customers and the Australian public better