Australia | Jan 12 2009
By Andrew Nelson
ANZ’s monthly job ads survey shows there were 9.7% fewer jobs advertised in December than the month before, taking the annual growth rate of job ads to its weakest level since the series began in 1975. The staggering weakness in this latest job ads survey suggests the Australian labour market could be in much worse shape than many had been banking on.
In December there were an average of 190,661 job ads in print and on-line per week, pushing down job ads in trend terms by 5% in December, or 23.4% for the year. Newspaper job advertising plummeted 14.1% in December to an average of about 10,100 a week, dragging down annual growth in the reading by more than half, while internet job ads were off by 9.5% in December to an average of 180,500 per week, 28.1% lower than a year ago.
The real tale of the tape is now Thursday’s official unemployment read, but with analysts expecting only a minor uptick to around 4.6%, this latest job ads read could definitely throw a spanner into the works. In fact, looking at these latests numbers has TD Securities Senior Strategist Joshua Williamson thinking that unemployment estimates of around 6% for 2009 are now too conservative.
Looking at newspapers alone, the yearly decline was a massive 52%, with Williamson noting that even accounting for some substitution towards internet ads over the past five years, “this result is staggeringly low”.
Internet job advertising also weakened substantially, dropping 9.5% in the month, the largest fall since the survey began including internet job advertising in 1998. Internet job ads are now 28.1% below year ago levels, which is also the weakest outcome since the survey began in 1998.
ANZ head of Australian economics Warren Hogan said the result provides further evidence that the demand for new labour across the Australian economy is now at recession levels. He said that a 50% decline in newspaper job advertising in a year is historically consistent with economic recession within the next nine months. He also predicted the unemployment rate to rise to 6% in 2009, up from the current rate of 4.4%.
“In any event, the latest job advertising results indicate that the Government unemployment forecast of 5% by June 2009 followed by continued modest employment growth in 2009/10 is too optimistic.” This leads Hogan to expect an upward revision to the official unemployment forecast in the May Budget, which will result in a further deterioration in the Government’s financial position.
All states were worse for wear, with Western Australia falling by 22.8% in December as the local resources-based economy starts to cool dramatically in the face of lower demand and lower prices for iron ore. With Chinese iron ore customers expected to seek prices 40% lower than last year, a WA recovery may be some way off.
Victorian job ads dropped 18.2% in December, while South Australia gave up 17.2% over the same period. Large falls were also evident in Queensland, down 10.5% and New South Wales, down 10.1%. Tasmania fared a little better, dropping only 4.3%.
The Northern Territory was the only state or territory to experience a rise in newspaper job advertisements in December, up 7.5%. However, this was in some part due to the unwinding of a 17.4% fall in November.