Job ads down sharply in May

Job ads fell for the first time in five months following a slump in consumer confidence linked to the federal budget, according to the ANZ Job advertisements series, a leading employment and economic activity indicator. 

In the first release of the ANZ Job Ads since the Federal budget, total job ads fell 5.6 per cent month on month in May, the sharpest fall since May 2011, but economists expect any impact to be temporary. 

“Our view is that labour demand should improve modestly this year amid better economic conditions,” ANZ senior economist Justin Fabo said.

“The timing of the fall coincides with the deterioration in consumer confidence since negative newsflow regarding the Commonwealth budget began and suggests that business confidence has similarly been affected. 

“In the first quarter, exports - particularly iron ore - grew strongly and the interest-rate-sensitive sectors of the economy continued to pick up; retail sales grew strongly, residential building activity bounced and house prices continued to rise. 

“In the last month or so, however, there has been some moderation in this data. Housing looks to have lost some momentum and retail sales growth has slowed noticeably.

“Given the imminent pullback in mining investment and the associated headwind to employment growth, we believe the unemployment rate should remain in the 5¾ - 6 per cent range over the coming year.” 

Newspaper job ads rose in NSW, Western Australia, ACT and Tasmania, however this follows a large decline in April, which included Easter and Anzac day which historically depletes newspaper job ads. 

On Thursday, the ABS releases the May labour market report. ANZ expects that employment rose by 15,000 in May, reflecting lags associated with the pick-up in economic activity around the turn of the year, and that the unemployment rate remained at 5.8 per cent.

Having trouble viewing this video? Click here to view it in Youtube.