ANZ job ads: dip in February

KEY POINTS

ANZ Job advertisements fell 0.7% m/m in February in seasonally adjusted terms after recording a solid 3.9% rise in January. Annual growth in job ads edged down to 6.9% y/y this month from 7.1% in January.

 

Trend growth in job ads eased somewhat to 0.4% m/m in February after averaging 0.6% m/m growth over the last eight months. The annual rate firmed up and stands at 6.6% in February compared to 6.1% last month.

ANZ HEAD OF AUSTRALIAN ECONOMICS DAVID PLANK COMMENTED:

“After a strong rise in January, job ads fell slightly in February. Some moderation in job ads is not unexpected given the strong January result and may reflect the tricky nature of seasonal adjustment at this time of the year.

The unemployment rate has been stuck at around 53⁄4% since early 2016. Moreover, much of the employment growth over 2016 has favoured part-time rather than full-time jobs, implying a considerable degree of slack in the labour market. This is likely to weigh on wage growth and has the potential to delay the return of underlying inflation into the 2-3% target band beyond late next year. As such, we expect that uncertainty about labour market momentum and the weakness in wage growth will be a key topic of discussion at this week’s RBA board meeting.

Looking ahead, strength in business conditions, firms’ profitability and an increase in capacity utilisation all point to an improvement in labour market conditions in our view. Overall, we expect the unemployment rate to slowly edge downward through 2017.”

FIGURE 1. JOB ADVERTISEMENTS MODERATE IN FEBRUARY