- Australian job postings fell slightly in July but the demand for workers remains incredibly strong.
- Job postings in occupations such as medical information and personal care have increased sharply over the past three months.
- Australian wages are growing at their fastest pace in eight years and, with the unemployment rate at a 48 year low, appear likely to strengthen further over the remainder of the year.
This month’s labour market update focuses on the ongoing strength in Australian job postings and recent developments in Australian wage growth.
Australian job postings remained elevated throughout July
Despite ongoing concerns around high inflation and rising interest rates, the demand for workers remained elevated throughout July, suggesting that labour market conditions may tighten further in the near-term.
By the end of July, job postings on Indeed were tracking 126% ahead of their level on February 1, 2020, our pre-pandemic baseline, after adjusting for seasonal trends. The number of postings fell 0.4% in July but is up 7.8% over the past three months.
Australian postings remain high by international standards, with growth well above the US, UK and Canada. While recruitment has been strong in each of these countries, Australia has consistently outperformed, with our recovery beginning earlier and remaining stronger despite repeated COVID-19 lockdowns.
Job postings rose modestly in New South Wales and Victoria during July but that was more than offset by weakness in other states. Postings in Tasmania fell 18% in July, easing to its lowest level since early May, with postings down 3.5% in South Australia and 2.6% in Western Australia.
Despite the July decline, job postings in every state and territory remain high by historical standards and consistent with further tightening of labour market conditions.
Demand for workers growing strongly in some occupations
Over the past three months, job postings have grown strongly in occupations such as medical information (+36.9%), personal care (+35.5%), real estate (+33.8%) and sports (33.2%).
By comparison, there are a number of occupations where demand for workers has eased recently. Job postings for childcare workers have fallen 13.6%, with mathematics (-10.0%), dental (-8.7%) and banking & finance professionals (-7.8%) also falling considerably.
It is, however, important to remember that where postings have fallen they are typically doing so from a very high level. Competition for talent remains elevated across every occupational category and that’s as true today as it was three months ago, even for those occupations where postings have recently fallen.
Australian wage growth is poised for a breakout
Australian wages have increased 2.6% over the past year. Although this marks the strongest wage growth since March 2014, few Australian workers will be jumping for joy. Unfortunately, with consumer prices up 6.1%, Australian workers have just experienced an unprecedented fall in the purchasing power of their incomes.
There is, however, evidence that wage growth is starting to break out and could increase above 3% over the second half of the year. But workers will need to be patient because wages for most jobs change infrequently. The infrequent change in wages is also why the improvement in wage growth has been so slow.
Australian wage growth is driven partly by the size of the change in wages but also the share of jobs where wages change. In the June quarter, around 14% of Australian jobs experienced a wage change and the average increase was 3.8%. That was the largest quarterly increase in wages in a decade and presents clear evidence that tighter labour market conditions have triggered greater wage competition as businesses try to attract new staff and retain existing workers.
If that 3.8% gain was replicated in the September quarter – when wages for around 40% of jobs change – then national wage growth will jump above 3% for the first time in almost a decade. While that still falls short of inflation, it would mark a pretty important milestone in Australia’s overall jobs recovery.
All posting figures in this blog post are derived from seasonally adjusted job postings. We seasonally adjust each series based on historical patterns in 2017, 2018 and 2019. Each series, including the national trend, occupational sectors and sub-national geographics is seasonally adjusted separately. We adopted this methodology in January 2021.
The national and regional analysis is based on the percentage change in job postings on Indeed’s Australia site since February 1, 2020, our pre-pandemic baseline.
The number of job postings on Indeed.com, whether related to paid or unpaid job solicitations, is not indicative of potential revenue or earnings of Indeed, which comprises a significant percentage of the HR Technology segment of its parent company, Recruit Holdings Co., Ltd. Job posting numbers are provided for information purposes only and should not be viewed as an indicator of performance of Indeed or Recruit. Please refer to the Recruit Holdings investor relations website and regulatory filings in Japan for more detailed information on revenue generation by Recruit’s HR Technology segment.
The data on wage growth come directly from the Australian Bureau of Statistics via its quarterly wage price index report.