As forecast the latest ANZ job ads survey for September shows demand for new employees continues to ease
The latest survey, released yesterday by the ANZ shows a 2.1% fall in new job ads last month, after revised 0.7% fall in August.
The ANZ job ads survey, which measures companies’ hiring intentions, sagged 2.1 per cent in September following a revised 0.7% (0.6% fall originally) fall in August.
Total job ads fell to 182,365 in a week last month, seasonally adjusted, ANZ said, while the average number of newspaper jobs was 8,070 a week, seasonally adjusted.
The average number of internet jobs each week was 174,296.
The news of the fall had economists forecasting a slow September jobs and employment report from the Australian Bureau of Statistics on Thursday.
Despite the fall in job ads, the ANZ believes there will be a moderate 7,000 new jobs reported in the ABS survey, with the unemployment rate remaining steady on 5.3%.
The ANZ sees much of the same sort of growth in employment in coming months, meaning the unemployment rate will rise to 5.5% by midway through 2012.
The driver was a 2.2% drop in inline job ads with newspaper flat and not really a major indicator anymore.
Newspaper advertising is now 12.8% lower than a year ago, while internet advertising is 4.0% higher over the same period, "in part reflecting the continuing structural shift to online advertising," according to the ANZ.
"This is the first month newspaper advertising has not fallen since February.
"Further monitoring of trends in newspaper advertising is warranted over coming months as newspaper advertising tends to lead online advertising trends, notwithstanding the continuing structural change towards online advertising," the ANZ said.
"Moderating job advertising points towards a further softening in employment growth in the months ahead and a modest rise in the unemployment rate.
"To date, the weakening trend for job advertising is more like the 1995-96 experience rather than the sharp slowdown during the global financial crisis in 2008-09 or even the more significant slowdown experienced in 2000-01.
"During 1995-96 the unemployment rate rose 0.4% between June 1995 and December 1996, while in 2000-01, unemployment rose around 1 percentage point," the ANZ said.
The ANZ also said that in line with a rising unemployment rate, wages and underlying inflation pressures are likely to ease as well.
The bank says that will leave room for two rate cuts by the RBA.
"Accordingly, there is scope for the RBA to reduce interest rates a little as insurance against weaker than expected growth outcomes and even higher unemployment.
"We expect the first of two 25bp cuts are likely to be enacted at the next board meeting in November.
"This would be a prudent move given global uncertainties and downward revisions to global growth forecasts."
The ANZ however isn’t as optimistic as some about the extent of rate cuts in the months ahead.
"ANZ does not expect the more significant interest rate cuts currently priced by markets and sees only a move back to a more ‘neutral’ stance from a ‘slightly restrictive’ stance at present."
The bank said that analysis of job advertising shows that they are "beginning to reflect the emergence of a more noticeable geographic split to Australian economic growth.
"Job advertisements are rising solidly in Western Australia and the Northern Territory and the declining trend is moderating in Queensland (together the states with the greatest exposure to mining).
"At the same time, advertising is continuing to slow reasonably quickly in NSW and Victoria."
Given these comments it will be interesting to see what business confidence and conditions are like in the NAB’s monthly survey, out later today.
