Job ads jump again in August

A solid gain in the number of job advertisements in August suggests conditions in the labour market are improving slowly, according to the ANZ job advertisements series, Australia’s leading employment and economic activity indicator.

"All of these developments are consistent with a very gradual turnaround in conditions in the labour market."
Warren Hogan, ANZ chief economist

“Job advertisements are up 1.5 per cent in the month of August and about 8 per cent year to date,” ANZ senior economist Justin Fabo says.

“Normally, with an increase of this amount, we’d expect to see an improvement in labour market conditions, which is what we feel is actually happening. But we’re actually not seeing that in terms of the official unemployment rate numbers in Australia."

The August rise follows an unexpected jump in the official unemployment rate in July, from 6.0 per cent to 6.4 per cent.

ANZ chief economist Warren Hogan says the data shows a drop in the number of unemployment benefit recipients, while consumer unemployment expectations have also improved.

"All of these developments are consistent with a very gradual turnaround in conditions in the labour market,” he says.

ANZ expects jobs growth will pick up again in the second half of the year, but the unemployment rate is forecast to remain broadly stable at just over 6 per cent for the remainder of 2014.

“On the one hand, strengthening labour demand in some labour-intensive industries, such as in construction, health and retail, is an encouraging sign," Hogan says.

"However, the effect on employment from the windback in mining investment is likely to have further to run, which will be a hindrance to a strong improvement in the unemployment rate over the next year or so."