Households nervous as jobs go en masse
Thousands of workers were told they would lose their jobs on Thursday amid growing signs the labour market is deteriorating.
As Ford said it would cut 1200 jobs as part of its move to stop making cars in Australia, the entire 2500-strong staff of cleaning company Swan Services also lost their jobs. Swan had employed about 500 cleaners in NSW and the same number in Victoria, according to union estimates.
Ford's move to stop making cars here from 2016 also puts thousands more positions at risk in the vehicle parts industry, which will lose one of its biggest customers.
A Westpac index showed households' expectations of job prospects had worsened significantly.
Administrators of Swan, which provided cleaning services to offices and shopping centres, laid off its entire staff of cleaners after they were appointed by directors on Wednesday. An administrator from Pitcher Partners, Anthony Elkerton, said the company had been unable to cover its wages bill, so it had been forced to eliminate all positions.
"We have terminated all employees and we are currently in the process of formally notifying them," Mr Elkerton said. "There are a number of sites where staff have been re-employed by other contractors."
National president of United Voice union Michael Crosby said Swan had been one of the five biggest cleaning businesses in the country, and its woes followed a string of collapses in the industry.
"Swan Services could potentially owe cleaners hundreds of thousands of dollars in entitlements, including annual leave, sick leave, unpaid wages, superannuation, and we want to ensure they are protected," Mr Crosby said.
It is unclear how the company, founded and owned by Robert Swan, got into financial trouble.
Mr Elkerton said it had been losing money on several contracts, was hit by a major computer glitch earlier this year, and had faced delays receiving payments from customers. Early estimates are the company owed $2.8 million to creditors and was owed $2.5 million.
"Rumours have been circulating over the company's financial health, especially over the past weeks. Debtors have certainly delayed their payment terms, which hit the profitability of the company," Mr Elkerton said.
This week, Telstra announced it was restructuring the divisions that employ half its 30,000 local staff, a move that is tipped to result in deep job cuts.
Australians appear increasingly nervous about their employment prospects. Figures from the Westpac index show consumers' unemployment expectations jumped 5.4 per cent this month, after a 1.3 per cent rise in April.
Westpac senior economist Justin Smirk said the rise in the index suggested the unemployment rate could be heading towards 6 per cent, up from 5.5 per cent.
The budget tipped a rise in the unemployment rate to 5.75 per cent.
"People are currently experiencing a softer labour market and they are expecting things to continue to deteriorate in the year ahead," Mr Smirk said.
"The fact that it's moving up suggests to us that we will see softer job numbers in full-time work in particular, and a further rise in the unemployment rate."
The sharpest fall in expectations was among managers and labourers, he said.
Doubts are also swirling around the future of one of Aurizon's small businesses that specialises in shifting container freight, and employs several hundred people across the country.
The rail freight operator formerly known as QR National is expected to review the future of its intermodal business next financial year, and analysts believe it will eventually be closed.
Four apprentices at BHP Billiton's Cannington mine in Queensland lost their jobs on Thursday, as the world's biggest miner continues to build up its cost-cutting regime.
It is believed the workers were employed through a contract training provider.
with Peter Ker and Matt O'Sullivan
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