* Forward-looking measures of labour demand all flashing green
* Revival in consumer spending heralds recovery in retail jobs
* Surge in home building to help construction over mining hump
By Wayne Cole
SYDNEY, April 9 Job losses in manufacturing have dominated Australian headlines -- 350 at BP, 180 at Philip Morris, 300 at Boeing in the past month alone -- but data proven to herald increased hiring tell a much cheerier tale.
In a country obsessed with real estate, a housing boom has given people confidence to spend more freely -- and that may be enough to keep a lid on unemployment in the year ahead.
"Overall, our range of forward-looking indicators of economy-wide jobs growth unanimously point to improved hiring intentions and a turning point in the labour market," said Scott Haslem, chief economist at UBS.
Hopes are fixed in particular on retail and construction, where a revival in consumer spending, an invasion of foreign retailers and a surge in home building all bode well for a sizable pick-up in employment.
If past patterns on measures such as job advertisements, vacancies and a range of business surveys hold true, Haslem estimates that retail, hospitality and wholesale combined with construction could generate around 140,000 jobs in the coming year.
That would not be far from the 170,000 needed to stabilise the unemployment rate near its current level of 6 percent.
"Our clients are always asking 'where will the jobs come from?'" said Haslem. "But our analysis shows it is much less difficult to answer the question than is widely believed."
The reasons for uncertainty seem clear. Unemployment has risen to 6.0 percent, the highest since mid-2003. The central bank expects the labour market to stay soft and the unemployment rate to rise further.
In February, Toyota Motor Corp became the last of the global automakers to say it planned to cease production in Australia, triggering angst about the future of manufacturing.
FOREIGN BRANDS SET UP SHOP
But the situation for manufacturers is not as bad as the headlines suggest. Over the six months to February, for example, manufacturing actually added 38,200 jobs.
And after a long fallow period, retailers have enjoyed a marked acceleration in spending in recent months. The annual growth rate in sales quadrupled from a Scrooge-like 1.2 percent in mid-2013 to a far more store-friendly 4.9 percent in February.
That is good news for the labour market as the A$270 billion ($250 billion) retail sector is the second-biggest employer behind health, with 10 percent of all jobs. Add in the wholesale and hospitality sectors, and the job share rises to 20 percent.
Australia's two biggest supermarket chains certainly seem optimistic. Coles, owned by Wesfarmers, plans to invest A$1.1 billion over the next three years building 70 stores and creating more than 16,000 jobs. Rival Woolworths will open 108 new stores in its 2014 fiscal year alone, generating around 7,000 jobs.
The pipeline of construction work is already swelling, with the value of building approvals across the retail and wholesale sectors up 24 percent in February from a year earlier.
And it is not just local retailers. Australia is suddenly attracting a flood of new entrants, encouraged by its strong currency and rapid population growth.
Zara, Gap, H&M and Topshop are among the big-name foreign retailers to have set up shop, while Japanese casual-wear group Uniqlo opens its first store in Australia this month, as does U.S. chain Brooks Brothers.
MANY HOMES TO BUILD, FURNISH
The revival in spending owes much to a red-hot housing market. Historically low mortgage rates have unleashed pent-up demand and lifted home prices in the major cities by over 10 percent in the past year.
Property consultant RP Data estimates there were almost a quarter of a million properties advertised for sale over March, yet demand stayed ahead of supply.
"Although new listings are way up on a year ago, the rate of sale is much faster," says RP Data research director Tim Lawless. "To put it simply, properties are being absorbed by the market faster than they are being listed for sale."
The Housing Industry Association (HIA) estimates sales of new homes jumped 4.6 percent in February to their highest in almost three years.
All these homes have to be kitted out, boosting demand for everything from furniture, to appliances to garden equipment.
Sales of household goods surged 3.8 percent in the first two months of the year. Sales of hardware, building and garden supplies grew an annual 10.7 percent, the fastest in a decade.
There is much more to come as approvals to build new homes were up by almost a quarter in February from a year earlier and not far from all-time highs at an annualised rate of 200,000. The value of approvals for building new office space is also running hot with annual growth up at 46 percent.
The bulging pipeline of work should help fill the hole left as major mining projects start winding down or are completed.
"Importantly, there has been strength in job advertising in some key industries, including construction," says Ivan Colhoun, head of Australian economics at ANZ.
The bank compiles a monthly tally of job advertisements on the Internet and in major newspapers. It found ads climbed to 132,925 in March, the highest in almost a year.
"There is now clearer evidence that labour demand is strengthening," said Colhoun. "This suggests that conditions in the labour market are beginning to improve, despite recent job-loss announcements in a number of companies. (Editing by Lincoln Feast and John Mair)