For the six month in the last seven, the ANZ job ads survey has shown a fall in the number of monthly job ads appearing in newspapers and on the internet.
And once again, ANZ economists are forecasting a small rise in the unemployment rate to 5.5%, as they have been doing for several months, and once again the credulous media at the ABC and elsewhere took this to be ‘new’ news when it is in fact more of what we have seen for most of 2011.
The weaker and drifting jobs market is not really a new development and the RBA pointed out in its last Monetary Policy that it expected unemployment to rise modestly in the immediate future, before falling back to the current level of around 5.2% to 5.3%.
The Reserve Bank said in monetary policy statement on Friday, “Growth over the next few years is expected to be driven by mining-related activity, with below trend growth in the non-mining economy.” Trend growth is between 2-3%.
"Over most of the forecast period, domestic demand is expected to grow at an annual rate of around 4 per cent, with growth in imports running substantially faster than this.
"In the central scenario, the unemployment rate is expected to increase a little before moving lower again, to around its current level.
"The mining boom remains a central element in these forecasts, with mining investment expected to increase very strongly over the next few years, particularly in the LNG sector. In contrast, growth in the non-mining economy is expected to remain below average.
"The household saving ratio is forecast to remain around its current level and growth in public demand is expected to remain subdued, given ongoing fiscal consolidation," the RBA said.
For the second month in a row, the ANZ said that it was forecasting the unemployment rate to rise to 5.5% by mid-2012.
That forecast for a small rise in the jobless rate was "consistent with employment growth of less than 5,000 jobs per month.
"However, with the mining investment boom building through 2012 and with the subsequent flow on effects on the Australian economy, ANZ does not foresee a more substantial increase in the unemployment rate.
"In line with a rising unemployment rate, wages and underlying inflation pressures are likely to have begun moderating. As such ANZ believes there is continued scope to ease interest rates towards a ‘neutral’ stance from the ‘more neutral’ stance at present. ANZ expects a further 25bp cut in the cash rate in February 2012."
The ANZ is looking for a 5,000 fall in employment in the October data which will be out Thursday, with the jobless rate up to 5.3% from 5.2% in September.
In the October survey, the ANZ said yesterday the job ads index dropped 0.7% to 181,005 ads online and in print, after a fall of 2.1% in September.
“The weakness in both internet and newspaper advertising suggests below trend growth in employment and a gradual rise in the unemployment rate over coming months,” ANZ Head of Australian Economics and Property Research Ivan Colhoun said in yesterday’s release.
Newspaper job ads in October fell 2.7% to a seasonally adjusted 7,855 or 16.7% down over a year.
Internet job ads slipped 0.6% per cent in October, to 173,150. Internet advertising is now 4.2% lower than the recent peak in March this year.
"While remaining 7.3% higher than a year ago, this is the slowest pace of annual growth in eighteen months," the ANZ said.
The Reserve Bank said in its quarterly monetary policy statement on Friday, “Growth over the next few years is expected to be driven by mining-related activity, with below trend growth in the non-mining economy.” Trend growth is between 2-3 per cent.
The RBA cut interest rates for the first time since April 2009 last Tuesday, leaving them at 4.5%.
We get the monthly NAB business confidence and conditions report later today with an improvement expected after that rate cut.
