A range of indices paints a somewhat positive picture of the year ahead.

Unemployment rate & Economy
The big news is unemployment rate dropped to 5.5% and the IMF forecasts the economy to register a growth rate of  2.5% in 2010, and 3% in 2011.

Job Vacancies
The three main index monitoring job vacancies are all showing positive signs even though recovery in online ads are not substantial. Olivier Job Index grew by 0.48% in December, up almost 10% from July.  The DEEWR’s Skilled Vacancy Index (print job ads) grew by 1.1% in January , but the Internet Vacancy Index (online job ads) dropped by 12.1%. The ANZ job series also reported growth.

Employer Confidence
Employer confidence increased for the third consecutive quarter according to the latest Hudson Report.  Nationally, a net 29.1% of employers are planning to increase headcount in the next quarter.  Sectors like the IT industry are particularly positive, with a net 40.8% planning to increase headcount of permanent staff.

The D&B’s National Expectation Survey also found that firms are heading into 2010 with a very positive outlook. However, the employment outlook index has fallen back to 0, which is still up by 26 points on the June quarter when the index registered its lowest point since the survey started in 1998. Seven percent of SME employers are planning to increase headcount offset by 7% who are planning to decrease.

The Sensis Business Index, also shows a bounce in confidence level of the small business sector, currently registering its highest level since August 2007. In a positive development, SMEs are also positive about the next 12 months, with 20% indicating an increase in headcount.

Consumer Confidence
Consumer confidence has also increased. The latest Westpac- Melbourne Institute noted ‘households assessed that their job security has improved substantially.

Whichever way you looked at 2010 promises to be a lot more different than 2009.

Of course, these are hard times. The RBA has slashed interest rate to 3.00% (50 year low) and is on the verge of officially declaring recession in Australia.

Employers confidence has taken a beating. Hudson’s latest report revealed only 18.6% of employers intend to hire new staff, while a corresponding 17.8% will decrease headcount, resulting in a net effect of 0.8%. A similar report by Manpower also found employment outlook to be grim with only 17% of employers intending to increase headcount while 16% forecast a decrease.

If we take a closer look, it’s not all bad news. Some sectors like utilities, healthcare and education are maintaining confidence (see chart).  Regionally, employers in states like ACT and QLD are still hiring as confidence in VIC and NSW dipped.

Numbers look garish when interpreted in national averages. Generalising and lumping all regional economies under one national umbrella does not paint an accurate picture of the realities at the local level. Just as national unemployment rate of 5.2% doesn’t means much at the local level, employers sentiments varies widely.

Sure times aren’t exactly rosy, but parroting national data only adds to the collective panic, and distracts everyone from the important task of rebuilding the economy.