Job security is the number one concern for 36 per cent of Australian mortgage holders, new research has revealed.
A Pureprofile survey conducted in November 2016 on behalf of loan and mortgage protection provider ALI Group, asked 1,000 Australian mortgage holders how they felt about their mortgages given "the housing affordability crisis, increasing budget deficit and economic uncertainty".
The research revealed that one in three mortgagors were concerned about their job security when it comes to servicing their mortgage, with those with dependent children most concerned. Forty-one per cent of married/de facto respondents with dependent children and 43 per cent of singles with children nominated job security as their top worry, compared with 34 per cent of married/de facto respondents without kids, and 14 per cent of singles without kids.
Those who worked part-time were more concerned about job security in relation to their mortgage repayments, with 42 per cent of part-time workers citing this as a primary concern, compared to 35 per cent of full-time workers.
The survey also found that half of the respondents had worried more than once about being made redundant by their employer, with those under the age of 30 most concerned (56 per cent).
Among those aged over 45 years, 67 per cent had been concerned about being made redundant by their employer.
Further, 37 per cent of all respondents suggested it would take more than three months to find a new job that matches their skills and level.
Huy Truong, CEO of ALI Group, commented: “These findings come as Australia experiences continued structural changes in the economy, including continued job losses in low tech manufacturing, automotive and mining industries.
“About 2.3 per cent of Australian workers become redundant due to corporate downsizing or closure [according to the Organisation for Economic Co-operation and Development] while further reports found that almost 40 per cent of jobs are at risk of being lost due to automation and computerisation by 2030.
“This figure is even higher in rural and regional areas, at 60 per cent. There are new jobs being created, particularly in growth industries like the personal services sector, but it takes some time for people to find new employment.”
He added: “Given the ongoing industry shifts, I anticipate job changes and employment anxiety will continue to rise. This anxiety will undoubtedly start to impact consumer confidence.”
ALI Group has said that, in light of the survey findings, it will now increase the level of unemployment cover from the first 12 months to the first five years of the policy, whilst keeping its premiums the same.
Mr Truong concluded: “There is a role for companies like ALI to recognise these economic shifts and develop solutions that help mitigate the risk and uncertainty. Sudden job loss causes significant stress, with a profound impact on a household’s ability to contribute to their mortgage. The reality for those who can’t find a new job quickly is that they may be forced to sell an asset, or lean on family.
“As more current and future Australian home buyers become more aware of this type of protection, they will gain more confidence to enter the property market, and in turn, have their concerns about job security reduced.”