A record fall in the number of job advertisements in February paints a bleak picture of an economy already in recession, economists say.
The ANZ Banking Group survey found total job ads in newspapers and on the internet dropped 10.4 per cent in the month of February, the largest monthly fall since the series began in 1999.
Moreover, it was the 10th consecutive monthly decline and the second double-digit percentage fall over the past three months.
The number of job advertisements in newspapers and on the internet fell by 39.8 per cent in the 12 months to February.
This was also the worst outcome in the history of the survey and a sign the deterioration in the labour market was gathering pace in response to the global financial crisis and economic downturn.
ANZ head of Australian economics Warren Hogan said the survey suggested a substantial rise in the unemployment rate was likely and pointed to an economy already in recession.
“Recent trends in job advertising are consistent with other indicators, which suggest that the Australian economy entered recession in late 2008 and remains in recession in early 2009,” Mr Hogan said in a statement.
“The current downturn in the economy is likely to last throughout 2009, with little prospect of a meaningful recovery before 2010.”
The number of job advertisements in major metropolitan newspapers fell by 25.2 per cent in February to an average of 8,524 a week.
This more than reversed the 12.3 per cent rise January, which is regarded as a volatile month for job ads and difficult to seasonally adjust.
Newspaper advertisements fell 55.4 per cent in the year to February, the quickest pace of decline on record.
Internet job advertisements slipped 9.4 per cent in February, for an annual pace of 38.6 per cent.
nabCapital senior economist David de Garis said the weakening economy would place companies under growing pressure to sack staff.
“It’s conceivable that employers may continue to hoard labour for the time being,” Mr de Garis said.
“But with orders continuing to bleed and businesses running down stocks even further so far this year, that hoarding will not last too much longer.
“If employment turns negative in the next few months, as these labour demand indicators suggest, then employment could decline by around 40,000 on average by June.”
Confirmed retrenchments in recent weeks have included clothing group Pacific Brands, which said it would sack 1800 workers, and the loss of 170 jobs at car parts maker Robert Bosch.
ANZ revised its unemployment rate forecasts in response to the February survey.
The bank now expected the nation’s jobless rate to reach 6.5 per cent by the end of 2009 before climbing further to 7.5 per cent by the middle of 2010.
“These job advertisement numbers, based on historical relationships, suggests the risks to our forecasts are for higher unemployment,” Mr Hogan said.
The Australian Bureau of Statistics publishes the February labour force report at 1130 AEDT on Thursday.
The market forecast at the start of the week was for the economy to have lost 20,000 jobs in February, with the unemployment rate tipped to reach five per cent, up from 4.8 per cent in January.