White-collar job anxiety may be more imagined than real, new global report suggests, as we head into busy spring selling season

As we enter the traditionally busy spring selling season, the likelihood and extent of a property market recovery remains extremely hard to call, with white-collar job anxiety one of the factors in a complex jigsaw puzzle that includes interest rate expectations, house price concerns, the impact of changes to government handout schemes, and investor appetite.

While the national unemployment rate remains low by international standards – sitting just above 5% – the perception remains that the mining sector is supporting the high rate of employment, with even RBA governor Glenn Stevens noting in his post-cash rate decision statement yesterday that jobs are being shed in some industries.

At the same time there were perhaps some raised eyebrows – though not from those enjoying their morning tea and scones – when March 2012 mortgage delinquency figures from Fitch Ratings showed the prestige suburbs on Sydney’s north shore and their counterparts in the eastern suburbs of Melbourne remained among the best-performing locations in Australia.

Surprise, surprise, the rich continue to manage to pay their mortgages, and talk of a white-collar recession appears as unlikely as Lleyton Hewitt winning another grand slam.

A new international report compiled by Swiss-based UNI Global Union Finance, which counts around 20 million affiliated members, provides some insights into the white-collar job picture and suggests that the Australian banking sector has cut relatively few jobs compared to the industrial-size job cuts at other international banks since the GFC.

The figures are based on information submitted to UNI Global Union Finance from representative finance sector unions in 21 countries and show that since the beginning of the financial crisis, more than 300,360 jobs have been lost in the finance sector in 18 countries (UK, Spain, Italy, France, Germany, Austria, Finland, Norway, Sweden, Denmark, Belgium, Romania, Moldavia, Greece, Ireland, Australia, India and the US).

Australia has accounted for less than 3% of these job cuts, with the Finance Sector Union (FSU) reporting that Australian banks have shed around 10,000 jobs since 2007, with nearly two-thirds (6,200) shipped offshore.

The biggest job cutters have been Westpac and ANZ, which have cut a combined nearly 2,000 jobs, with Westpac sending nearly half of its 1,021 positions cut offshore.

Furthermore, according to the FSU figures supplied to the report, there are no more large-scale job cut programs on the cards in Australia.

A figure of 10,000 jobs lost is certainly not a small one, but it is when compared with what has happened in countries with comparable first-world banking systems like the US, UK and Switzerland.

UK-based banks has cut nearly 65,000 jobs – six and a half times more than Australian banks –with HSBC cutting 30,000 positions and Lloyds 24,000.

The US figures in the report, which apply only to 2011- 2012, show 30,000 positions cut by Bank of America alone.

In Italy, where the economic picture has turned dire, the report notes that there were 10,000 job cuts from 2005 to 2012 while 20,000 people left through early retirement packages subsidised by the state.

As many as 15,000 or so more jobs are expected to go over the next three years, with all the major Italian banks having big redundancy programs in place to 2015.

So it appears that Australian banks have taken a relatively conservative approach to job cutting – a message that is unlikely to bring much cheer to those who have lost their jobs, especially given the enormous profits reported recently by all the major banks.

Interestingly, the UNI report notes that some of the biggest job cuts have been made by banks that continued to make big profits.

“In 14 banks which account for almost 3 million workers, more than 121,000 people have lost their jobs or are about to lose their jobs. At the same time, the same banks made profits last year, in the range of US$4 billion to $40 billion in 2011 alone. For example, HSBC made almost $22 billion of profit in 2011, but decided to cut 30,000 jobs. Deutsche Bank made $7 billion of profit but lost 22,000 jobs,” the report says.

This might also explain to some degree why those sipping tea in Mosman and Neutral Bay and Kew and Hawthorn have not struggled to pay their mortgages – clearly there are still big bonuses being paid from the billion-dollar profits.

However, the UNI report is unlikely to ease any of the anxiety among those working in the lower-echelons of the banking industry (many of whom would be either first-home buyers, upgraders or investors) – especially given the constant references from major bank CEOs in the recent reporting season to the current tough operating environment.

Indeed it would be naïve to suggest – as some have –that all that’s needed is a bit more sun and blue skies this spring and summer for the property market to rebound.