The number of jobs being advertised in Australia fell modestly last month, partially reversing an enormous jump in January.
According to ANZ, advertisements fell by 0.7% to 165,643 in February in seasonally adjusted terms, moderating slightly after surging 3.9% in January.
As a result of the monthly decline, year-on-year growth in advertisements slowed to 6.9%, down from 7.1% reported previously.
The ANZ series counts the average number of advertisements carried by Seek.com.au and the Department of Education’s site, Jobsearch.gov.au, for a particular day “that is representative of activity levels seen over the broader month”.
It does not include advertisements placed on job bulletin boards, workplace intranets and from word of mouth.
David Plank, head of Australian economics at ANZ, said that he was not overly surprised by the result, suggesting that moderation in job ads is not unexpected given the strong January result.
He also said that the decline “may reflect the tricky nature of seasonal adjustment at this time of the year”.
Looking ahead, Plank says that strength in business conditions, increased profitability of some firms and rise in capacity utilisation continues to point to improving labour market conditions in his opinion.
“Overall, we expect the unemployment rate to slowly edge downward through 2017,” he says.
However, while Plank is looking for the unemployment rate to move slightly lower this year, he doesn’t think that it will be enough to deliver a meaningful lift in wage growth, something that is currently growing at the slowest pace on record according to the ABS wage price index.
“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,” he says.
Given the RBA increased scrutiny over labour market conditions under the leadership of Philip Lowe, he says that uncertainty over momentum in the labour market and persistent weakness in wage growth will be a key topic of discussion at this week’s RBA board meeting.
The RBA will deliver its March interest rate decision on Tuesday, March 7.
Speaking in early February, Lowe acknowledged that Australian employment growth slowed last year with “the growth that did take place… almost entirely in part-time employment”.
“Looking forward, the number of job vacancies and job ads suggest that some strengthening in employment growth might be in prospect,” he said.
“Our central forecast though is for the unemployment rate to remain close to its current level for some time to come.”