ANZ says Job Advertisements rose 2.0% m/m in August, the sixth straight rise. Job advertisements currently sit 13.3% higher than a year ago.
In trend terms, job ads were up 1.3% m/m in August following a 1.4% rise in the previous month. Annual trend growth picked up slightly, rising from 11.6% in July to 12.5% in August.
ANZ commented:
Job advertisements continue their period of strength, consistent with robust business conditions. Together with other forward indicators and survey-based measures, this strength suggests some downside risk to the unemployment rate in the near term, with employment expected to rise in the order of 15–20k per month over the period ahead.
While the RBA is likely to find the ongoing improvement in labour market conditions encouraging, persistently low wage growth presents some uncertainty to the outlook for both consumption and inflation. The Q2 GDP report, later this week, will provide information on how the economy is tracking overall. We do not expect consumption growth to be particularly weak in Q2 given the increase in household disposable income from additional hours worked. Additionally, the higher than usual increase in the minimum wage (in effect since 1 July) will likely provide some support to spending in Q3.
That said, given the elevated levels of existing household debt and already low savings rate, we find it difficult to envision a sustained increase in consumption growth without some pickup in wage growth and consumer confidence. This will act as a constraint on the acceleration in GDP growth even as business investment picks-up.
