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In some good news, the latest payroll job numbers released on Tuesday showed that the number of jobs is back to where it was last year just before the impact of the pandemic shutdown hit in the middle of March.

But nothing is ever simple in the economy, and a closer look reveals that the growth has come from only a small number of industries – especially public administration:

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Scott Morrison likes to say governments don’t create jobs, but were it not for the public service, and the overwhelmingly public sector heath care industry, the overall picture would be much worse.

While total numbers look fine, there remains a lot of weakness in the economy.

Where there is some clear cause for concern is in the construction sector.

Work in construction always drops over Christmas, but this year it has failed to recover, and the number of jobs in the industry is some 3.8% below what it was a year ago:

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That’s not great given the government has been crowing about the success of its homebuilder program. But it just highlights that while home construction and renovations are important, so too is non-dwelling construction:

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And of course the public sector is also a great creator of construction work via infrastructure programs.

What construction workers, and the economy as a whole needs, is investment. But the latest finance and wealth data from the bureau of statistics revealed that 2020 was the worst year for investment in over 30 years:

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And we truly see the impact of that in the latest engineering construction figures released yesterday.

In the final three months of last year, engineering construction work – which includes a raft of aspects such as road, rail, bridges, telecommunication and sewerage – fell for both private and public sectors:

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The 1.8% fall for work done by the private sector for the private sector (as opposed to contracts for governments) means that for nine out of the past 12 quarters, private sector work has fallen.

It is a nice reminder that even before the pandemic, things were not going swimmingly.

Unfortunately we are not seeing the public sector take up the slack:

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The sudden drop-off in the last three months of last year might be somewhat due to shutdowns, but there was no real sign of any explosion of work before then:

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In December the real value of infrastructure work done for the public sector was the lowest for five years – a big part of which was a drop in the amount of work done building roads and on the NBN:

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And given construction jobs remain well down on what they were a year ago, there does not appear to be much reason to believe there has been a strong pick up in infrastructure work in the first three months of this year.

That is a concern because while private investment remains down, the public sector needs to fill the hole, and right now, aside from the homebuilder program, there is little sign of that occurring:

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The return of the total job numbers to pre-pandemic levels is obviously good. But it should not be taken as sign that things are back to normal – or that the economy is as it was prior to the pandemic.

Firstly, prior to the pandemic the economy was not all that healthy, and secondly, the job numbers are very much driven by a minority of industries, while others remain very much in need of public investment and new infrastructure programs.