- Australian job ads plummeted in May, according to ANZ, recording the largest monthly decline since the GFC.
- The timing of Easter and the Anzac Day holiday in late April, coupled with caution ahead of the federal election held in the middle of May, likely contributed to the result.
- ANZ reports that advertising levels rebounded following the Federal election.
- Given issues with trying to seasonally adjust for the election and timing of public holidays this year, a true indication on current job market may not arrive until next month.
Australian job ads plummeted in May, recording the largest monthly decline since the GFC.
According to ANZ Bank's job ads series, new postings tanked by 8.4% in May after seasonal adjustments, the largest percentage decline since January 2010.
The steep fall left total ads down 14.9%, the sharpest annual decline since 2013.
The ANZ job ads series measures changes in online advertisements on jobs websites Seek.com.au and the Department of Employment’s job vacancies site Jobsearch.gov.au.
Image: ANZ Bank
So based on advertising levels employment growth in Australia is about to fall off a cliff, leading to a sharp increase in Australia's unemployment rate?
Perhaps, but David Plank, head of Australian economics at ANZ, says there plenty of reasons to show caution towards the ugly May result.
“Job ads were down sharply in May, which at face value points to a sharp slowing in employment growth. But we think there is a good reason why this decline is not representative of reality," he said in a note released alongside the latest update.
"Job ads plunged in the last week of April, which we think was due to the ‘holiday year’ effect that happens when Anzac Day and Easter are close together.
"We think the run up to the federal election contributed further to delaying job postings."
So the timing of Easter and the Anzac Day holiday in late April, coupled with caution ahead of the federal election held in the middle of May, led to a steep fall in advertisements, partially reflecting problems in trying to seasonally adjust for such an unusual scenario.
Adding to reasons why the latest job ads update needs to be treated with extreme caution, Plank said advertising levels late in the month surged, pointing to the likelihood of a steep recovery in June.
"Postings in the last week of May -- after the election -- were considerably higher than in the previous four weeks," he said.
"If the last week of May is indicative, then job ads will rebound strongly in June.”
Here's hoping Plank is right, otherwise the recent lift in Australia's unemployment rate may be about to get a whole lot faster.
The June job ads update will be released in early July. Before that, Australia's official jobs report for May will be released on June 13.
Given what was seen in the ANZ job ads series last month, a "clean" reading on the current health of Australian labour market conditions may not be forthcoming until Australia's official jobs report for June is released in the middle of August.