ANZ Job Ads: Possible stabilisation in Job Ads

ANZ Australian Job Advertisements showed some stability in April with a closeto- unchanged result, after five successive large monthly declines.

In seasonally adjusted terms, job ads fell just 0.1% m/m to be down 5.6% y/y. This was an improvement on the 6% y/y decline recorded for March and the smallest monthly decline since there was a small increase in October last year. In trend terms, job ads dropped 0.9% m/m to be down a large 6.3% y/y. This is the largest annual fall in the trend series since January 2014.

ANZ’s Head of Australian Economics, David Plank, commented:

“After five successive steep falls, it is pleasing to see a virtually unchanged result in job ads for April. We aren’t getting too carried away with the result, since we saw last year that a positive result for October was followed by renewed weakness. Still, it is good to see that the decline in job ads may not be accelerating. ANZ Job Ads has not been a reliable guide to the unemployment rate for some time, with the ABS Job Vacancy series providing a better signal. We are looking into reasons why the two series have diverged. Job Ads have, however, continued to lead the direction of employment growth reasonably well (Figure 3 below). Job ads suggest employment growth will slow but remain positive. Slower jobs growth will not be enough to reduce the unemployment rate further, however. This makes it unlikely that wage growth will accelerate by enough for the RBA to be confident of meeting its inflation target. The labour market needs to get stronger, which is why we think the RBA will ease policy on Tuesday.”