Skilled job vacancies hit 13-year high. Record petrol prices.

Skilled job vacancies; Energy market update

National skilled job vacancies rose by 7.8 per cent in October to stand at a 13-year high of 250,882 positions.

Last week, the Brent crude oil price fell by US$1.64 or 1.9 per cent to US$82.74 a barrel and Nymex crude dropped by US$2.30 or 2.8 per cent to US$81.27 a barrel.

The Australian Institute of Petroleum reported the national average unleaded pump price fell by 2.1 cents last week to 166.7 cents a litre. Over the week, pump prices hit record highs in Canberra, Hobart and Perth.

Skilled job vacancies – October

• In a very positive sign for future employment, a key indicator of labour demand today showed that a hiring surge is imminent after lockdowns in Australia’s south-east. The preliminary National Skills Commission’s Internet Vacancy Index (IVI) jumped by 7.8 per cent (or 18,082 available positions) in October – the biggest lift in seven months – to a 13-year high of 250,882 available positions. And recruitment activity is up by a massive 58.3 per cent (or 92,440 ads) in October on a year ago and is 49.2 per cent above pre-pandemic levels in February 2020.

• With NSW emerging from a prolonged lockdown on October 11, employers geared up for the economic re-opening with NSW job ads surging by 16.9 per cent (or 12,539 positions) in October. There were 87,187 available positions in the Premier state at the end of October, also a 13-year high.

• A hiring blitz is also underway in Victoria with skilled job vacancies rebounding by 15.2 per cent (or 8,962 positions) in October – the most in seven months – to a 13-year high of 67,828 available positions. And it was a similar story for the ACT with the 12.5 per cent (or 759 positions) lift in job ads in October the biggest monthly gain in 17 months.

• Job vacancies edged higher in Queensland (up 0.2 per cent or 76 positions) in October, but labour markets were weaker elsewhere. In fact, the number of skilled job vacancies fell by 6.6 per cent in Tasmania (-206 positions) and 2.7 per cent in Western Australia (-743 positions). And job ads dipped by around 1 per cent in both South Australia (-138 positions) and the Northern Territory (-28 positions).

• With 80 per cent of Aussies aged 16 years and over now fully immunised against Covid-19, the NSW and federal governments are considering ending hotel quarantine requirements for vaccinated foreign skilled workers amid labour shortages. The Reserve Bank recently noted that wages growth had been strong for specific occupations where skills shortages are acute, such as IT professionals, agriculture workers, tradies and chefs. That said, the Bank cautioned that the labour market needs to tighten further after the Delta virus lockdown shock, with the unemployment rate not expected to fall from current levels of 4.6 per cent (September) to near 4 per cent until late 2023.

• The expected inflow of foreign labour – once international borders reopen – could actually dent wage growth momentum and underlying inflationary pressures as worker supply increases, keeping the Reserve Bank on the policy sidelines for an extended period.

• The labour force report is released on Thursday and Commonwealth Bank (CBA) Group economists expect around 50,000 jobs to be added or reinstated in October. But with workforce participation likely to rebound after lockdowns, the unemployment rate could lift from 4.6 per cent to 4.7 per cent.

Weekly energy market update

• The Australian S&P/ASX 200 energy index tumbled 1.9 per cent last week, dragged down by an 8.2 per cent fall in Beach Energy shares as crude oil prices fell. Over the week Brent crude fell US$1.64 or 1.9 per cent to US$82.74 a barrel and Nymex crude dropped US$2.30 or 2.8 per cent to US$81.27 a barrel.

• The decline in oil prices came after the OPEC+ meeting last week where producers decided to stick with their scheduled 400,000 barrels per day increase in crude output, despite the strong post-Covid recovery in fuel demand. In fact, Saudi Aramco raised its official selling price of crude to all buyers across the globe on Friday. Energy giant BP is estimating that global oil demand has rebounded above the pre-virus level of 100 million barrels a day.

• Attention now turns to whether US President Joe Biden responds to the OPEC+ meeting with American drivers paying the most for gasoline per gallon since 2014. US Energy Secretary, Jennifer Granholm, said that the Biden Administration is looking at a potential release from the US strategic petroleum reserve to boost supply.

• The benchmark Singapore gasoline price fell by US$3.49 or 3.4 per cent to US$99 a barrel last week. In Aussie dollar terms, the Singapore gasoline price fell by $2.16 or 1.6 per cent to $133.84 a barrel or 84.17 cents a litre.

• The national average wholesale (TGP) petrol price rose by just 0.4 cents last week to 156.4 cents per litre. Today the TGP price sits at 155.5 cents per litre, down from 13-year highs of 157.3 cents per litre in the previous week.

• According to the Australian Institute of Petroleum the national average unleaded pump price fell by 2.1 cents last week to 166.7 cents a litre. Pump prices were at record highs in Canberra (171.4c/l), Hobart (175.2 c/l) and Perth (172.4c/l), with Darwin prices at 7-year highs of 169.3 cents a litre last week.

• MotorMouth records the following average retail prices for unleaded fuel today: Sydney 165.0c/l; Melbourne 164.5c/l; Brisbane 161.0c/l; Adelaide 162.4c/l; Perth 171.9c/l; Hobart 176.0c/l; Darwin 169.6c/l and Canberra 171.7c/l.

• Unleaded pump prices are gradually easing in both Sydney and Melbourne with fuel around 165 cents a litre today, down by up to 14 cents a litre since mid-October. South-East Queensland is in the ‘cheap phase’ of the retail fuel cycle with pump prices near 161 cents a litre. With the discounting cycle now three weeks old, Brisbane motorists should fill up their tanks ahead of a likely price hike in the coming week.

Published by Ryan Felsman, Senior Economist, CommSec