Australia | May 04 2009
By Chris Shaw
The trend remains down for job advertisements in Australia, the ANZ Job Ads series for April showing a fall in total ads across both newspapers and the internet of 7.5%, slightly better than the 8.5% fall recorded in March but equal to an annual fall in ads of 49.9%.
The weakness in April was driven by lower internet ads as this category was down 8.1%, the average of 128,567 ads per week being 49.2% lower than was the case this time last year. In contrast, major metropolitan newspaper ads actually rose in the month by 3.1% to an average of 8,203 per week, which compares to a decline of 6.6% in March.
While this is something of an improvement, the bank’s head of Australian economics Warren Hogan notes newspaper ads are still down almost 59% from April of 2008. Driving the increase this month was a higher level of ads in Tasmania, the Northern Territory and New South Wales in particular, while Queensland and South Australia recorded only minor increases. Both Victoria and the ACT recorded modest falls, while Western Australia experienced the sharpest falls in an outcome that reflects the slowing of activity in the Australian mining sector.
Hogan suggests the ad series data indicate a further contraction in the Australian labour market in coming months but in a slightly different form than has been the case to date. According to Hogan, since the onset of the global financial crisis much of the 1.7% increase in Australia’s unemployment rate to date has come because of labour force growth and rising participation, but going forward he expects falling employment to be the driver of further such increases.
In Hogan’s view the job ad numbers are consistent with Australia’s unemployment rate rising above 7% in the next 12-18 months, with a possible peak of more than 8% in the current cycle. The bank expects the reading will top out at 8.25% sometime in 2010, which is above the Government’s current forecast of a peak of 7% in unemployment. Given the difference Hogan expects the Government will lift its estimate when it brings down the Federal Budget next week.