ANZ’s job advertisement survey is well-known as a leading indicator of employment numbers in Australia. It reflects changes in demand for labour and it provides another measure of activity in the economy. There is also a fairly good inverse relationship between changes in Australia’s unemployment rates and changes in the RBA cash rate. Understanding the path of Australia’s unemployment rate has historically provided a reliable indicator of RBA rate changes.
November’s figures have been released and, after revisions, total advertisements were 1.7% higher at 172,395 (seasonally adjusted), up from October’s revised figure of 169,577. On a 12 month basis, job advertisements were 11.2% higher while October’s comparable figure was 12.5%.
ANZ Head of Australian Economics David Plank said Australia’s employment market is likely to improve. “Another steady rise in ANZ Job Advertisements in November along with other leading indicators suggests a positive outlook for the labour market, particularly given the solid prospects for economic growth.”
The inverse relationship between job advertisements and the unemployment rate is quite strong (see below chart). An increasing number of job advertisements as a proportion of the labour force should lead to lower unemployment rates in the near-future.