Total number of non-manual employees in the workforce

IBISWorld forecasts the number of non-manual employees to increase by 1.6% in 2024-25, to average 10.46 million people over the year. The unemployment rate is expected to remain near record lows. New entrants to the workforce are expected to mostly be non-manual workers, following the long-term increase in white-collar occupations as a share of total employees. Regulations mandating increased staff numbers at child care centres and aged care homes are set to bolster growth in the number of community and personal service workers.

Despite the shock to the economy following the COVID-19 outbreak, many non-manual employing businesses were able to remain productive by shifting to remote work during lockdown periods. The Federal Government also limited the decline in non-manual employees during the pandemic, through the JobKeeper Payment scheme. The successful rollout of the COVID-19 vaccine and the easing of remaining government restrictions boosted growth in total number of non-manual employees in Australia over the two years through 2022-23.

Over the past decade, manual employment has exhibited sluggish growth, while non-manual employment has grown at a rate beyond that of population growth. Manual jobs have been threatened by offshoring to low-wage countries, competition against imported goods from those countries and increased automation in production processes. These threats have not affected non-manual employees to the same extent due to Australia's competitive advantage in professional industries, which require highly educated employees which are less abundant in low-cost countries.

The greatest threat to non-manual employees is in sales work. Growth in the number of workers in this segment has slowed considerably over the past five years, with the increasing popularity of online shopping leading to many bricks-and-mortar retailers closing down entirely or cutting back operations. This was exacerbated by the temporary closure of many retail establishments during the COVID-19 pandemic. While sales worker numbers have since returned to pre-pandemic levels, this growth has been outpaced by the increasing number of other white-collar workers, in particular professionals, and community and personal service workers. The Australian economy has increasingly become a service- and knowledge-based economy, with the skills held by Australian workers in comparison with foreign workers – for example, higher education and cultural familiarity within Australia – typically those that translate to non-manual employment.

The growth in non-manual employment, particularly in comparison with manual employment, is also driven by Australia's ageing population. The composition of retiring workers is more slanted towards manual employment, as retirees generally gained their skills in an era when manual employment was more common than non-manual employment. Furthermore, older workers that have not yet retired are often unable to continue performing manual labour, and instead, move into non-manual roles. Additionally, Australia's ageing population has boosted demand for medical and aged care professionals, contributing to the increase in non-manual workers. Overall, IBISWorld forecasts the total number of non-manual employees to grow at a compound annual rate of 3.4% over the five years through 2024-25.