The ANZ job ad series has historically been a good leading indicator of employment growth in the Australian economy. The Haed of ANZ Economics Warren Hogan had this to say:
“The rate of decline in job advertising intensified in the month of December, providing further evidence that the demand for new labour across the Australian economy is now at recession levels.
“Australia has no experience of recession since we started collecting internet job ads, so all our longer-term historical comparisons are based on the newspaper series. A 50% decline in newspaper job advertising in a year is historically consistent with economic recession within the next nine months and a rise in the unemployment rate over the following years.
Newspaper ads are now down -51.8% from a year ago. However to what extent this reflects the shift from newspaper to internet is unknown and therefore comparisons to pre-internet days should viewed with caution.
However, it is clear that the unemployment rate will rathchet up in 2009. ANZ are predicting an unemployment rate of 6% by the end of 2009, that sounds about right but the risk is that it goes higher by the end of year.