ANZ Australia job ads rise strongly in January, labor market strong to support gradual drop in jobless rate in 2017

Australia’s job advertisements increased strongly in the beginning of 2017. Job advertisements rose 4 percent sequentially in January, more than reversing the drop of 2.2 percent seen in December. On a year-on-year basis, annual growth in job ads rebounded to 7.1 percent year-on-year, rising sharply from 3.7 percent year-on-year in the prior month, noted ANZ. In terms of trend, job advertisements were up 0.6 percent sequentially in January. The annual pace was up slightly to be 6.1 percent year-on-year in January from 5.5 percent year-on-year in December.

ANZ senior economist Felicity Emmett stated that the strong rise in ANZ job ads in January is in line with the rise in business conditions and sentiment recorded in the prior week. The rebound in conditions, ongoing strength in house prices and last week’s trade surplus imply that the underlying fundamentals of the economy stay strong in spite of the disappointing third quarter GDP report.

However, not all the recent data have been solid. The jobs report recorded reasonable employment growth, but the rise in the jobless rate was disappointing.

“But the bounce in ANZ job ads, along with modest increases in other leading indicators, lends support to our view that although momentum in the labour market has slowed, it remains strong enough to underpin a gradual decline in the unemployment rate this year”, added Felicity Emmett.