Colin Brinsden, AAP Economics and Business Correspondent
(Australian Associated Press)
Job advertising fell again in September, pointing to an unemployment rate above five per cent in the coming months largely as a result of the COVID-19 lockdowns in NSW and Victoria.
The ANZ job ads series fell 2.8 per cent in September, the third consecutive monthly decline, but were still over 20 per cent higher than their pre-pandemic level.
“The cumulative decline of 6.8 per cent over the past three months is only a tenth the size of the 64.4 per cent plunge between February and May last year, during the national lockdown,” ANZ senior economist Catherine Birch said.
“This is consistent with our expectation that the measured unemployment rate will only lift a little above five per cent later this year.”
The jobless rate currently sits at 4.5 per cent.
Reserve Bank of Australia governor Philip Lowe believes hours worked is the best indicator of the labour market at the moment, noting they declined by nearly four per cent in August.
“The restrictions on activity have had a significant effect on the labour market,” Dr Lowe said in a statement following Tuesday’s RBA monthly board meeting.
However, he said the bank’s business liaison group found that many firms are seeking to hire workers ahead of the expected reopening in October and November.
As widely expected, the RBA board left the cash rate at a record low 0.1 per cent.
Dr Lowe reiterated that the rate won’t be increased until inflation is sustainably within the two to three per cent target, a condition that is not expected to be met before 2024.
Meanwhile, the prospect of leaving lockdowns has lifted the mood among Sydneysiders and Melburnians, but confidence in other parts of the country has turned sour.
Overall, the ANZ-Roy Morgan consumer confidence index – a pointer to future household spending – rose 0.9 per cent in the past week.
It was the fourth consecutive weekly rise, taking the index to its highest level since mid-July. However, at an index of 104.6, it is still some way off its long-run average of 112.5.
“With Sydney and Melbourne headed towards re-opening in the next few weeks, confidence increased in both cities by 4.4 per cent and 1.5 per cent respectively,” ANZ head of Australian economics David Plank said.
However, confidence in regional Victoria fell by 4.1 per cent, and there was a 2.1 per cent decline in Adelaide, while Brisbane tumbled by nine per cent and Perth dropped by 6.2 per cent.
The Australian Bureau of Statistics confirmed retail spending fell by 1.7 per cent in August, a third consecutive monthly decline.
But in its retail trade update for the month, it showed online spending soared by 15.1 per cent, a third month of double digit percentage gains.
“This elevated level of online spending is likely to continue right through to Christmas and Australians should make plans to shop earlier this year,” Australian Retailers Association CEO Paul Zahra said.
Separately, Australia’s construction industry saw something of a bounce in September as strong engineering activity more than offset further declines in house building and commercial construction.
The Australian Industry Group-Housing Industry Association performance of construction index rose 14.9 points to 53.3 in September, with the move above 50 indicating the sector is back in expansion territory.
“Looking ahead, the further easing of restrictions, and the resumption of work put on hold should see more decisive improvement in the sector in the months ahead,” Ai Group chief policy advisor Peter Burn said.