Labour market shows signs of easing after a year of strong growth

After a year of strong growth there are signs that the Australian labour market is easing, with the SEEK Employment Index falling slightly for the first time since it was launched in July.

Developed in consultation with Victoria Universityís Centre for Strategic Economic Studies, the SEEK Employment Index is the first Australian aggregate indicator to directly compare labour market supply with labour market demand.

The data for October, released today, indicates a possible softening in the Australian employment market. The number of new job ads posted in October fell by 6.9% (seasonally adjusted), but remain 36% higher than at the same time last year.

Meanwhile, the total number of job applications received remained relatively steady, falling by just 0.6%. This means that the number of applications received per new job posted increased in October, and therefore there was more competition among job seekers for positions than in the previous month.

SEEK CEO Paul Bassat said that the October data also reveals some interesting State by State trends.

ìIt is clear that the Queensland and Western Australian labour markets continue to be the most bullish in Australia, riding on the back of a booming resources sector.

ìQueensland was the standout performer in October, being the only State to experience an increase (3.4%) in the number of new job ads posted for the month. This builds on a very strong increase of 52.6% in the number of new jobs posted during the past twelve months. Western Australia comes in second at 46.6%.

ìAt the other end of the spectrum, New South Wales posted a fall in new job ads of 10.2% in October, reducing growth in the number of new jobs posted to just 15% for the year.

ìWe are clearly seeing an imbalance in the location of new opportunities at present, and employee mobility is a potential concern for many businesses, as job seekers are more willing than ever to relocate to other States for the right employment opportunityî, he said.

Professor Peter Sheehan, Director of the Centre for Strategic Economic Studies emphasised that it is too early to interpret the sharp overall decline in new job ads in October as a decisive shift in the demand for labour in Australia.

ìThe hiring behaviour of employers can bounce around as perceptions are influenced by factors such as petrol price rises, that may or may not result in a slowdown of the economy. Over the last twelve months employment supply and demand have grown at a similar level, and further monitoring is required before any downward trend can be firmly identifiedî, he said.