Increased Demand Anticipated for Research and Education NFPs: CBA
14 July 2011 at 3:10 pm
This is the second instalment of a regular series of articles by the Commonwealth Bank, who will be using their financial experts to provide news, insight and expert advice for Not for Profit organisations.
In the Not for Profit sector, approximately 6,600 organisations are involved in education and research and can expect to experience increased demand for their services, according to Commonwealth Bank economist, James McIntyre.
McIntyre says NFP’s will continue to see increased demand in education and support services as the baby boom surge which began in 2004/2005 now starts entering school years.
He says that with the other strongly growing section of the population being the 65+ bracket more and more research is being demanded into health.
He says this will represent continued demand for the NFP organisations which operate in education and research fields.
The Commonwealth Bank’s last update spoke about Australia’s “patchwork economy,” looking at employment trends and job growth.
Commonwealth Bank research indicates that Australia is seeing different fortunes across industries as well as across regions.
A break down of labour market figures into individual regions (capital city v’s rest of the state) apparent trends are emerging. Over the 3 months to May 2011, regional employment growth was 3.2%, compared to 2.1% for capital cities. Even in states with weaker employment growth like Queensland and Tasmania, regional growth exceeded that of the state capitals.
Victoria has experienced the largest divergence with regional jobs growing at 4.7%+ compared to Melbourne’s 2.4%+ growth rate.
A surge in the participation rate has been a key driver of stronger growth.
James McIntyre says regional participation rates have been lagging over the past decade, compared to capital city participation rates. With the mining boom driving regional employment opportunities participation rates have increased to meet these new labour demands.
In the education and training sectors employment has grown rapidly over the last two years, particularly within primary and secondary school education. This surge can be attributed to the 2004/2005 baby boom. An additional 44,400 people have been employed since May 2010, equivalent to a 5.3% growth rate in the education and training sectors which make up 7.7% of the labour market .
And McIntyre says it’s not only schools that are experiencing growth – adult, community and other education employment is also on the rise at over 13.2% since May 2010 as demand for skills picks up.
Over the year to May 2011, employment has fallen by 10.1% in textile, clothing and footwear manufacturing, 15.7% in wood product manufacturing, and 23% in furniture and other manufacturing.
The Commonwealth Bank says organisations that have previously been involved with these sectors should consider these recent employment declines.
CBA says Not for Profits can use this data to increase their fundraising activities in regional areas. Increased employment participation should result in more people willing to support worthy causes.
It says NFP’s should also reduce fundraising activities in town heavily reliant on employment in wood and furniture manufacturing and be aware they may need to provide more support here than they have in the past.
Keep up-to-date with all the latest NFP Finance News from the Commonwealth Bank at probonoaustralia.com.au/news/commonwealthfinance
Disclaimer: Important Disclosures and analyst certifications regarding subject companies are in the Disclosure and Disclaimer Appendix of this document and at www.research.commbank.com.au. This report is published, approved and distributed by Commonwealth Bank of Australia ABN 48 123 123 124 AFSL 234945.