November ANZ job ads are out and higher unemployment is on its way:
- The number of job advertisements on the internet and in newspapers fell 2.9% in November, following a decline of 4.6% in October. This was the eighth consecutive monthly decline. The total number of job advertisements in November was the lowest since January 2010. Job advertisements are now 17% below levels seen in November last year. In trend terms, job advertisements declined 2.5% m/m in November.
- The number of job advertisements in newspapers declined 4.6% in November. Newspaper job advertising contracted in most states and territories and was particularly weak in New South Wales, Western Australia and Queensland. The Northern Territory recorded an increase of 3% which followed sharp increases of around 30% and 40% in September and October, respectively. Job advertisements in Tasmania rose 11% in November but data for this state are typically very volatile. The trend for newspaper job advertising is in decline for all states and territories except for the Northern Territory.
- The number of internet job advertisements fell 2.8% in November after falling 4.6% in October. Total internet job advertisements were 16% below levels experienced a year ago.
Here are the two charts that matter, ads:
And correlation with unemployment:
In fact, the ANZ is starting to sound quite worried:
ANZ Head of Australian Economics and Property Research Ivan Colhoun said:
- The trend in job advertising has continued to deteriorate. The weakness in job advertisements across the mining states of Western Australia and Queensland has been particularly concerning and reflects a much slower pace of mining-related hiring over the past six months. Over this period, job advertisements in Western Australia have fallen, on average by 6% each month and in Queensland the average monthly decline has been around 4%. The decline in newspaper job advertisements in Western Australia has been particularly sharp over the last three months, falling a total of 22%.
- Elsewhere, job advertising has remained soft and is not demonstrating any sign of a pick-up in non-mining labour demand. With the mining investment profile now not as robust as earlier expected, a pick-up in non-mining activity in the near term remains important. However, despite some signs of improvements in a number of economic indicators including building approvals and retail spending, the recovery in non-mining activity remains very tentative. Q3 capital expenditure data reinforced these concerns – while investment intentions in the mining sector were revised sharply lower, expected spending in the non-mining sector remained weak.
- Without a solid pick-up in the non-mining sectors as the mining investment boom winds back through 2013, the unemployment rate is set to drift higher to 5.75% by mid 2013. Without further monetary policy easing, the unemployment rate may rise towards 6% by the end of 2013. In the eight months of consecutive monthly declines, job advertisements have fallen 17%. In mid 2001, a comparable period of deterioration in job advertising trends, the unemployment rate rose half a per cent after a 15% fall in job advertisements.
- For many parts of the economy, interest rates remain high given the subdued level of business conditions. This is particularly true at a time when the Australian dollar has remained elevated. Further monetary easing is necessary to assist the economy in its transition towards a lower dependence on mining investment growth. We continue to expect a 25bps cut at the RBA Board meeting tomorrow and for the Bank to maintain a strong easing bias in 2013.
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And so they should. The RBA should have cut 25bps last month. It is becoming increasingly clear that we are entering something of a mining bust, the question now is how large? 50bps is live for tomorrow.ANZ Job Ads Nov-12 (1)