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ISCOVER
Staff Reporter
A slight drop in the number of jobs advertised could encourage the Reserve Bank of Australia to leave rates unchanged for the foreseeable future.
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According to the latest ANZ Job Advertisement Series, the number of job advertisements on the internet and in newspapers fell 1.2 per cent in June after falling 2.6 per cent in May.
Speaking about the results, ANZ senior economist Justin Fabo said the data shows there has been a mild “softening” in labour demand in Australia after it had strengthened somewhat in the early part of the year.
“In part, this likely reflects hesitation among some firms to hire additional staff in the face of heightened uncertainty about the global economy again in recent months, particularly in Europe. It also likely shows the pressure on profitability that some firms are experiencing, for a range of reasons, and may be an early signal that businesses are turning their attention to improving productivity,” he said.
Because of this, Mr Fabo said ANZ expects the Reserve bank of Australia to leave the cash rate on hold for “some time”.
“Recent communication from the RBA suggests that the official cash rate will remain unchanged for some time, while the Bank gauges the effect of prior monetary easing on the economy. Job advertisements have historically been a good leading indicator of changes in the official cash rate, so we will be closely watching job advertising trends in coming months,” he said.
