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The number of job adverts in Australia fell during May for the first time in five months, according to the latest report from ANZ Bank. Compared with April 2014, the number of adverts declined by -5.6%, coinciding with a deterioration in consumer confidence. Year-on-year the number of job adverts fell by -3%.
Justin Fabo, Senior Economist at ANZ, commented: “Job advertising fell sharply in May after improving gradually since the end of 2013. The timing of the fall coincides with the deterioration in consumer confidence since negative news flow regarding the Commonwealth Budget began and suggests that business confidence has similarly been affected. Along with confidence, the key question now is whether the fall in job ads is largely temporary. If it isn’t, this will be a risk to our forecast that labour demand will improve slowly this year amid modestly better economic conditions, with the unemployment rate expected to remain close to 6% for some time.”
“Economic activity appears to have lost some momentum recently after improving noticeably around the turn of the year. In particular, consumer spending has slowed and housing market activity has cooled somewhat, both at the same time that resources investment is falling sharply. Alongside this, consumer confidence has fallen sharply as news around the Commonwealth Budget has adversely affected sentiment. Uncertainty about when, and in what form, budget legislation will be passed in parliament has the potential to see weaker sentiment linger for some time. We will be watching confidence and job advertising closely over the next couple of months,” he added.
Only two territories reported year-on-year growth in the number of jobs advertised during May 2014; the Northern Territory (+16.3%) and Tasmania (+2.5%). The sharpest declines were reported in Victoria (-31.6%) and the Australian Capital Territory (ACT) (-27.2%). In Western Australia (WA), the region most closely associated with mining, reported a fall of -13.4% in the number of jobs advertised compared with last year. A month-on-month increase of +5.9% in job advertisements in WA can be explained as a correction of the -9.8% fall reported in April.