PREMIER Jay Weatherill has labelled South Australia’s unemployment rate of 8.2 per cent “deeply disturbing” but conceded it will likely get worse before it gets better.

SA’s unemployment rate moved past 8 per cent in June for the first time in 15 years.

Mr Weatherill said the state was suffering from decline in the manufacturing sector, a high Australian dollar and falling commodity prices.

He called on the Federal Government to come to South Australia’s aid with a “northern Adelaide plan” to counter job losses to come when Holden’s Elizabeth factory ceases manufacturing in 2017.

“We are yet to consume the closure of Holden’s and so it would be reasonable to assume that there are going to be many more challenging days ahead of us,” Mr Weatherill said.

“The period between now and the end of 2017 is not going to get any easier.

“We’re going to have to run just to stay still, just to actually (replace) the number of jobs that will be lost in the South Australian economy with new jobs.

“I am going to offer many more challenging propositions to put before the South Australian community but I think people understand the size of the challenge and they do expect there to be difficult things to grapple with.”

ABS data out this morning shows a drop of almost 6000 jobs in one month.

The last time unemployment was as high in SA as it is now was the year 2000.

It is becoming obvious that the employment crisis is here to stay, with the trend rate — which smoothes out month to month volatility — rising to 7.8 per cent.

SA’s jobs catastrophe has become a “human crisis”, according to the state’s foremost business representative.

And the staggering speed of the downturn has shocked even the state’s economic experts.

Business SA CEO Nigel McBride said “we can’t rationalise it or justify it, we just have to deal with it on the facts”.

“This isn’t just an economic crisis, it’s a human crisis and the impact of this right across the state is starting to be felt,” he said.

“Sadly we don’t see any reason why this is going to turn around.”

State Employment Minister Gail Gago issued a statement following the announcement (read it in full below).

She said the deterioration was a “real concern” and “as we move from a reliance on traditional manufacturing industries — coupled with collapsing commodities prices — we see South Australian unemployment rates really struggling”.

Associate Professor John Spoehr from the University of Adelaide said the result was particularly bad for men.

“In my view this is a male unemployment crisis,” he said.

The number of men employed in the state dropped by more than 8000 in June.

“It’s been brewing for a while but now it’s obvious that we are in the midst of a male unemployment crisis that will get much worse as the effects of the auto closure and downturn in construction impact over the next year or so,” Prof Spoehr said.

And the speed of the downturn — a full percentage point drop to the unemployment rate in just two months — has come as a shock.

“I didn’t expect it to hit as hard as this as early as it has,” he said. “It’s even surprised me.”

South Australia’s unemployment rate is now 1.7 percentage points higher than any other state or territory as Tasmania’s rate eased in June to 6.5 per cent.

In comparison the national unemployment rate increased just 0.1 percentage points to 6 per cent, and was steady on trend.

Mr McBride said the outlook was particularly bad for parts of regional South Australia such as Port Pirie or Port Augusta, which already face double digit unemployment.

“We’re seeing a situation where there’s a human cost,” he said.

“We’re seeing it in mental health, we’re seeing it in drug abuse and ice, we’re seeing it across the board that there’s no incentive for businesses to hire, to train.”

South Australian Centre for Economic Studies deputy director Steve Whetton said “it’s not a story of jobs disappearing, it’s much more a story of people entering in the labour force.”

He noted that jobs have grown faster than employment so far this year, and the rise in unemployment was due to a rise in the number of people looking for work — which is usually positive for the economy.

“It’s obviously not great for the people who are trying to find work but it suggests the problems aren’t as bad from the point of view of the state,” he said.

“It’s a better reason to have a high unemployment rate.”

State Liberal employment spokesman David Pisoni described the result as “very disturbing”.

“These figures tell us we’re in the middle of a jobs crisis here in South Australia and Jay Weatherill has no plan to fix it.”

Full Statement from Employment Minister Gail Gago

SOUTH Australia’s headline unemployment rate for June is 8.2 per cent, according to new Labour Force figures from the Australian Bureau of Statistics.

The national unemployment rate increased to 6 per cent.

“It’s a real concern to see a further deterioration in unemployment rates around the nation, particularly with South Australia’s rate increasing to 8.2 per cent,” Employment Minister Gail Gago said.

“As we move from a reliance on traditional manufacturing industries — coupled with collapsing commodities prices — we see South Australian unemployment rates really struggling.

“This is not helped by the Federal Government’s withdrawal of support for our auto manufacturing and navy shipbuilding industries, not to mention severe Federal Budget cuts in the health and education sectors.

“The State Government will continue to work with business and industry to support employment growth and skill training in a transitioning economy so all South Australians have the chance to find work,” Ms Gago said.

Today’s ABS figures show that South Australia recorded its highest level of employment and highest participation rate in two years.

Ms Gago said South Australians were actively participating in the job market and reaffirmed the need for bold action to create jobs.

“As the Premier has stated, we need to focus on transitioning South Australia from the old economy to the new economy, creating jobs for future generations of South Australians.

“That is exactly why our 2015-16 State Budget has allocated almost $985 million to support job creation, through reforming the tax system and investing in new and growth industries.

“The ABS figures show our participation rate has been increasing for 6 consecutive months, and June’s rate of 62.5 per cent is the highest since July 2013.

“We also have marked the highest level of employment in two years.

“Total employment in the State has been rising for six consecutive months, for a total increase of 6100, or 1000 jobs a month,” Ms Gago said.

The 2015/16 State Budget focuses on job creation and includes:

BUSINESS tax cuts of $670 million including the abolishment of stamp duty on commercial property transactions, making South Australia the best place in the nation to do business;

STIMULUS for new industries of $315 million to grow the jobs of the future, including tourism and international education; and

A TOTAL infrastructure spend of $10.8 billion supporting an average of more than 4650 jobs per year including upgrades to schools, hospitals and a new Adelaide Festival Plaza.

Last week also saw a $180 million per annum saving for business with the WorkCover levy slashed from an average of 2.75% to 1.95%.

“There are signs that the State’s economy is strengthening, including improving business confidence over the last two quarters and increases over the past year to high levels for retail sales, investment, housing construction and minerals and petroleum exploration expenditure.

“Our Budget forecasts South Australia returning to a long-term employment growth rate of 1.0 to 1.25 per cent for the next four years.”

Recent job losses in SA

Arrium Mining: 580

Santos: 500 (nationally)

Holden: 270

BHP: 230 since February, plus potentially 130 contractors

Arnotts: 120

United Dairy Power: 100

Aldinga Turkeys: 79

Leane Electrical: 40

Hills: 35

Penrice: 95

OZ Minerals: 80

Murray Zircon’s Mindarie mine: 36

Job losses to come

Alinta Energy: 440

Holden: 1260

Arrium Mining: More TBA

MAP — The Jobs Crisis Sweeping SA