Aaaand, the good news keeps on rolling with ANZ job ads down 2.4% in May. Although, the good news is the previous month was revised up from -3.1 to -0.8% so the damage is not as bad as first blush.
Here is the ANZ’s take:
The number of jobs advertised in newspapers and online declined 2.4% in May following a revised fall of 0.8% in April. Advertisements are 4.3% below year-ago levels, with sharper falls recorded in newspaper advertising (-17.3% y/y) than for online advertising (-3.6% y/y).
Newspaper job advertising trends recorded quite mixed results across the country. The most interesting development was the fifth consecutive monthly decline in newspaper job advertising in WA, where advertising fell 5% m/m. Newspaper advertising in Victoria was also very weak, falling 6.8% in May, the fifth consecutive monthly decline. A softer declining trend has been evident in the ACT, also for the past five months. A number of states recorded modest rises in newspaper advertising in May, notably NSW (+4.5% – the fourth rise in five months), Queensland (+2% – the first rise in five months), South Australia (+2.8%) andTasmania (+5.3%). Newspaper advertising in the Northern Territory remains very volatile on a monthly basis. The previous rising trend has flattened out in recent months.
Internet advertising trends have been somewhat stronger than those for newspapers, but have also softened in recent months. Advertising has been weakest in Victoria, the ACT and Tasmania, has softened in NSW but less markedly than the other weaker states and has been the strongest in the states with significant exposure to mining, namely WA, the Northern Territory and Queensland (with Queensland advertising less strong than WA and the NT). Even in these states, however, advertising has shown signs of moderate weakening in recent months.
Job advertising trends are sending a signal of a softening in labour demand in Australia, including more recently in the mining states. This mainly reflects continuing weaker performance in the non-mining sectors of the economy. Traditionally, weaker job advertising has been a reliable lead indicator of both lower interest rates and rising unemployment.
Official labour market data for May are released on Thursday. The unemployment rate has been volatile of late and surprisingly has trended lower. In part this has reflected lower participation in the work force, which is likely partly related to the ageing of the population. Other measures of labour market tightness suggest the unemployment rate may be providing a less reliable indication of trends in the labour market and the economy. Full-time employment growth is minimal; measures of underemployment are rising; the employment to population ratio is declining and the numbers of Australians receiving unemployment assistance are increasing.
In each case, these trends and those for job advertising are less dramatic than during the period before and after the global financial crisis. ANZ expects the RBA to reduce official cash rates by 0.25% at tomorrow’s Board meeting, with a further 0.5% reduction before the end of 2012.
Last month ANZ advised of problems related to data provided by one of the sources for online advertising. The provider has since released revised data for the past year, which appears to be when the data in question diverged significantly from that suggested by other data providers. Due to changes in systems, data coverage and definitions over previous years, historical data for prior periods cannot be provided on a basis consistent with this new data. ANZ has revised the historical series before that time for the data from this provider by using previously advised growth rates applied retrospectively to the new data.
The charts below show the impact of these revisions on the ANZ measure of job advertising. The level of job advertisements has been revised modestly lower throughout history but the broad trends are unchanged. The revisions correct the previously errant stronger rate of growth over the past six months for one of the smaller online data providers. The provider had been reporting jobs that had been filled as well as new job advertisements.
ANZ continues to monitor the evolving trends in the different channels for job advertising. ANZ is again confident in the quality and signal of the trend in the Internet based advertising series and cross references this signal with broad trends for advertising and the series provided by other data sources such as SEEK and DEEWR.
