Analysts at ANZ noted that the ANZ Job Ads increased 2.2% in May (seasonally adjusted), following a 2.0% fall in April.
Key Quotes:
“While job ads increased this month, they remain consistent with soft employment growth. Job ads are up only 0.1% q/q (3-month moving average). Annual growth was stable at 3.9% y/y (3mma).
The economy is dealing with some headwinds and that is affecting hiring. Downbeat business sentiment and uncertainty about labour relations policy are making businesses cautious about taking on more workers, in the context of an economy already grappling with capacity constraints”
“We expect the recent softening in job ads will be temporary, with the economy supported by fiscal stimulus and high terms of trade. But downbeat businesses sentiment, if sustained, could continue to weigh on labour demand.”
“We expect that tightness in the labour market will eventually feed through into higher wage inflation.”
“Wages will also be boosted by changes in the policy environment,including increases in the minimum wage and union pay negotiations. But despite this boost, any pick-up in underlying wage inflation may prove to be a slow grind, given the low inflation environment. And if businesses remain cautious about activity and hiring, that too could provide a dampening influence.”
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