ANZ Australian Job Ads Slip 5.5% as Omicron Hurts Sentiment

(Bloomberg) -- A closely-watched gauge of Australian job vacancies fell last month after surging in November as the rapidly spreading omicron variant of coronavirus dampened sentiment.

Australia & New Zealand Banking Group Ltd.'s index of help-wanted ads declined 5.5% in December from an upwardly revised 17.2% jump over the previous two months. Vacancies are still 36.8% above their pre-pandemic level.

December's fall probably also reflects the fact that the number of advertised positions filled exceeded the number of jobs newly advertised, as the index measures the stock of ads, Catherine Birch, a senior economist at ANZ, said in Wednesday's release.

“But it's also possible that businesses have become more hesitant to hire due to the spread of omicron and the consequent uncertainty around consumer behavior and worker availability,” Birch said.

ANZ data shows a much sharper than previous years drop in spending after the key Christmas and Boxing Day trading, partly in response to surging omicron cases across Australia.

Birch held out hope for a turn in sentiment.

“Looking ahead, we expect the job-switching rate to pick up in 2022,” Birch said. “With so much competition for labor and workers feeling secure in their jobs we should see more people moving to better jobs and asking for larger pay rises in 2022, contributing to stronger wages growth.”

The Reserve Bank of Australia has left interest rates at a record low 0.1% since November 2020 awaiting a pick-up in wages growth and inflation. Governor Philip Lowe reckons it will take about two years for the economy's strength to translate into faster price gains and rate liftoff. The next RBA board meeting is on Feb. 1.