Australia | Oct 05 2009
By Chris Shaw
The ANZ Banking Group’s Job Advertisements series followed up its gains of August by rising a further 4.4% in September, with both newspaper and internet ads posting gains for the month. Total ads are now 8.7% higher than the cyclical low point recorded in July, though the total number of job ads remains 44.9% lower than in September of last year.
Newspaper ads increased by 3.7% to an average of 8,929 per week, which follows a 5.5% increase in August. This puts newspaper ads 12.2% above their low from March this year, but they remain a little over 41% below the level of a year ago. September was the fourth successive month of growth in trend terms for newspaper ads, the data showing an increase of 0.5% for the month.
The Australian Capital Territory recorded the strongest increase for the month at 10.3%, While Western Australia saw a 5.1% increase and South Australia recorded a gain of 4.5%. In contrast, the Northern Territory and Queensland experienced minor falls for the month.
It was a similar story for internet ads as they recorded an increase of 4.5% to 127,141 per week, but even allowing for the second successive month of gains the total remains 45.1% below last September’s levels. In trend terms internet ads rose by 0.4% for the month, the first month of trend growth since March of 2008.
According to the bank’s acting chief economist Warren Hogan, today’s numbers show the Australian labour market is entering an early recovery phase following the downturn which is broadly reflective of what is happening in the economy in general.
Hogan notes the downturn was characterised by cuts to hours worked and this resulted in fewer job cuts, meaning there was an increase in underemployment rather than a significant increase in unemployment. The main driver of the increase in the unemployment rate was an increase in the size of the labour force thanks to strong population growth and high levels of participation in the labour market.
In Hogans’s view, once the recovery is underway this trend is likely to slowly reverse as working hours should increase before there are signs of growth in total employment numbers. Near-term, Hogan expects the labour market will weaken further as there is still low demand for new labour at the same time as job shedding continues and labour supply increases.
He estimates employment will fall by about 20,000 in September, which would push the unemployment rate above the 6% level. Looking longer-term Hogan is forecasting a peak in Australia’s unemployment rate of around 7.25% sometime in the middle of next year.