Job advertisements climbed again in April, leading some economists to conclude unemployment may have peaked.
ANZ’s monthly job advertisements survey found that ads grew 2.2 per cent last month.
It is the fourth consecutive month that ads have increased, and they are currently growing at an annualised pace of 30 per cent so far this year.
The more stable trend figure for job ads was up 1.5 per cent, and has been growing for five straight months.
“While the pace of improvement in job ads suggests that labour market conditions have only improved moderately at this stage – and therefore do not suggest a rapid turnaround in the unemployment rate – the pick-up in hiring intentions suggests employment growth will continue to improve modestly in the near term and the unemployment rate should be close to a peak around 6 per cent or slightly lower,” noted ANZ’s chief economist (Australia) Ivan Colhoun.
Mr Colhoun says housing appears to be the main driver of the economy’s improvement, with building approvals trending up, and consumer spending also improving.
However, while low interest rates are stimulating the economy, Mr Colhoun is concerned that a very tough Commonwealth budget could dent growth.
“The prospect of a larger-than-expected fiscal contraction, however, poses some risks to this outlook,” he warned.
“More specifically, the mooted introduction of a temporary deficit reduction levy will impact consumption both directly and indirectly. The direct hit to incomes from the tax as is currently suggested will likely trim growth and consumer spending a little this year (around 0.25 per cent of GDP).
“The coverage of the leaked policies in the media to date appears to have already weighed on consumer confidence, with ANZ–Roy Morgan consumer confidence declining by 4.4 per cent in the week ending 27 April.”
The ANZ figures show internet job ads rose 2.7 per cent last month, while newspaper ads slumped 11.8 per cent, although ANZ says this fall may be due to the timing of Easter holidays this year.