A customer walks from a Westpac bank branch in Sydney November 3, 2014. Australia's Westpac Banking Corp booked a fifth straight year of record profit with an 8 percent rise in full-year cash earnings on robust loan growth and declines in bad debts.
A customer walks from a Westpac bank branch in Sydney November 3, 2014. Australia's Westpac Banking Corp booked a fifth straight year of record profit with an 8 percent rise in full-year cash earnings on robust loan growth and declines in bad debts. Reuters/Jason Reed

Corporate reports put forth by Westpac suggest that company insolvencies are quite evident in recent times. As a result, the job market has been threatened, causing fear of either losing their jobs or getting one among individuals.

Australian Securities and Investments Commission data depicts the annual rate of insolvencies has risen to 0.5 percent in three months from 0.4 percent at the beginning of 2015. Westpac modelling sketches the graph on the rise and fall of the company figures, thereby enabling comparisons over time and across states. The latest figures showed that there are around 880 insolvencies this quarter, exceeding 750 recorded earlier in 2015.

“The rise takes the insolvency rate from the slightly below-average readings seen in 2014 to above-average readings on a par with those seen between 2011 and 2013,” Westpac economist Matthew Hassan said via ABC.net . The new hiring is still not very smooth, which might lead to labour shedding,thereby increasing the rate of unemployment in the country within few months, he said. According to Hassan, the modest rise in the rate of unemployment to 6.5 percent is easily expected by the end of 2015.

Furthermore, the Australian Bureau of Statistics has started working on the latest job figures, the result of which is expected to be revealed on Thursday. According to the Westpac’s analysis report, most of the companies that failed in recent times belong to the mining states, mostly in Queensland, in addition to non-mining states.

Hassan stated, “While low bankruptcy rates underscore the stable consumer picture, the lift in insolvencies suggests we may see a lift in labour shedding in coming months after a fairly benign period in 2014 and the first half of 2015.”

He concluded that personal bankruptcy is below average around all the states, but there are chances of upward movement of the rate of company insolvency due to the unemployment hikes and weakening of the housing market.

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