Figures released by Australia and New Zealand Banking Group Ltd on Monday show that the total number of job vacancies fell by 1.1% in July compared to June, when it had increased by 0.4%. Ads were still up 15.6% from the previous year, to 237,047.
“We may have passed the peak of vacancies, but the large volume of unfilled job vacancies means the labor market is likely to continue to tighten,” said Catherine Birch, ANZ’s chief economist.
“In fact, we now expect unemployment to fall below 3% at the start of 2023.”
The unemployment rate surprised in July by falling sharply to 3.5%, its lowest level in 48 years, thanks to the net creation of 88,400 new jobs.
This tight job market is one reason analysts are confident the Reserve Bank of Australia (RBA) will raise rates this week by at least 50 basis points to 1.85% , the fourth measurement since May. [AU/INT]
Job vacancies hit a record high of 480,100 in the three months to May, meaning there were almost as many open jobs as there were unemployed.
“Newly arrived skilled migrants, temporary visa holders, students and backpackers add to the supply of workers, but also to an already strong demand,” Birch added.
“So while the return of migration is improving labor mobility and matching, it doesn’t mean the gap is going to close quickly.”