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.
April’s figures have been released and, after revisions, total advertisements were 0.2% lower at 176,418 (seasonally adjusted) while March’s seasonally adjusted figures were revised down from 177,084 to 176,840. On a 12 month basis, total job advertisements grew by 8.6% while February’s comparable growth rate was 11.5% (after revisions).
Three months of lower monthly figures was to be expected according to ANZ Head of Australian Economics David Plank “Alongside the loss of momentum in job ads, employment growth has also slowed. In part we think this slowdown in employment reflects payback after excessive strength.” However, he remains of the view the overall level of employment should grow. “While the growth in job ads has paused, the level of job ads is high and is consistent with ongoing employment growth. As well, business conditions and profitability remain well above their long term average. Levels of capacity utilisation also remain high…For 2018 as a whole we expect jobs growth to be at a pace consistent with a gradual decrease in the unemployment rate.”