Welcome to the Fear and Greed business Interview. I'm sure, n aylmer. The labor market lost fifty three thousand jobs last month, and the sharpest fall in employment since late twenty twenty three, but a decline and the participation rate meant that despite the job losses, the official unemployment rate remained at four point one percent. Reserve Bank Governor Michelle Bullock has repeatedly voiced concerns about the strength of the labor market, So is it finally starting to ease? I wanted to take a look this morning at the official data, but go a little deeper into how it's being reflected in job ads and hiring trends across Australia. Callum Pickering is the senior economist at Jobs Platform. Indeed, Calum, welcome to Fear and Greed.

Welcome to the Fear and Greed business Interview. I'm sure, n aylmer. The labor market lost fifty three thousand jobs last month, and the sharpest fall in employment since late twenty twenty three, but a decline and the participation rate meant that despite the job losses, the official unemployment rate remained at four point one percent. Reserve Bank Governor Michelle Bullock has repeatedly voiced concerns about the strength of the labor market, So is it finally starting to ease? I wanted to take a look this morning at the official data, but go a little deeper into how it's being reflected in job ads and hiring trends across Australia. Callum Pickering is the senior economist at Jobs Platform. Indeed, Calum, welcome to Fear and Greed.

Thank you for having me.

Thank you for having me.

So let's start with the numbers yesterday. The unemployment rate four point one percent, fifty two nine hundred. I think new job losses. What's the key takeaway from the labor force data from the Bureau of Statistics yesterday.

So let's start with the numbers yesterday. The unemployment rate four point one percent, fifty two nine hundred. I think new job losses. What's the key takeaway from the labor force data from the Bureau of Statistics yesterday.

Well, look, it certainly a good thing when employment falls by fifty two eight hundred people. But I don't necessarily think it's as bad as it seems a first glance, and there's a couple of reasons for that. I think one is that we have seen these sizeable drops in the past. We saw one in December of twenty twenty three and it did absolutely nothing to derail Australia's jobs boom, and I suspect that'll probably be the case this time as well. Monthly data does tend to be quite volatile as well, so not too concerned about that, although obviously it's far from ideal. But also I think, you know, just in general, that the job market itself, you know, looking past that decline yesterday, still remains really tight. Most of the lad market metrics we have are still pretty healthy. Whether you're looking at the unemployment RAID or the underemployment RAID, or job vacancies or you know, whatever the lad marcametric is, it tends to be still pretty good by historical standards, and so I think that should give us some optimism about a state of the job market right now and going forward over the next three to six months.

Well, look, it certainly a good thing when employment falls by fifty two eight hundred people. But I don't necessarily think it's as bad as it seems a first glance, and there's a couple of reasons for that. I think one is that we have seen these sizeable drops in the past. We saw one in December of twenty twenty three and it did absolutely nothing to derail Australia's jobs boom, and I suspect that'll probably be the case this time as well. Monthly data does tend to be quite volatile as well, so not too concerned about that, although obviously it's far from ideal. But also I think, you know, just in general, that the job market itself, you know, looking past that decline yesterday, still remains really tight. Most of the lad market metrics we have are still pretty healthy. Whether you're looking at the unemployment RAID or the underemployment RAID, or job vacancies or you know, whatever the lad marcametric is, it tends to be still pretty good by historical standards, and so I think that should give us some optimism about a state of the job market right now and going forward over the next three to six months.

Michelle Bullock last month, the Governor of the Reserve Bank, talked about the job's market still being tight. In fact, I think she said that there are some signals that it was actually tightening even further. I mean, how do you read the jobs market. Let's say yesterday's number. I mean, the trend is your friend, and you know, we've still got a very strong low unemployment rate, But how do you read the job's market given what she said and the numbers yesterday.

Michelle Bullock last month, the Governor of the Reserve Bank, talked about the job's market still being tight. In fact, I think she said that there are some signals that it was actually tightening even further. I mean, how do you read the jobs market. Let's say yesterday's number. I mean, the trend is your friend, and you know, we've still got a very strong low unemployment rate, But how do you read the job's market given what she said and the numbers yesterday.

Well, certainly before yesterday, I would have tended to agree with Michelle Bauk. The job market was incredibly tight. There were signs that it was potentially even getting tighter. Now. I don't want to overreact to a single month of mad data. We do get them from time to time, but certainly, if we were to see another weakish result in March, then I think that would be a cause for concern. That would certainly indicate that maybe labor market conditions have shifted. Now right now, I'm not particularly concerned about that because when I look at forward looking measures of labor demands, such as job vacancies or the data that we've got at indeed, it indicates that there's still incredibly strong demand for workers across the country. These are jobs that need to be filled, and so you know, given that I think it's unlikely that we're going to see a spike in the unemployment rate in the near term. If anything, I think it'll probably be pretty flat. So things shouldn't change too much.

Well, certainly before yesterday, I would have tended to agree with Michelle Bauk. The job market was incredibly tight. There were signs that it was potentially even getting tighter. Now. I don't want to overreact to a single month of mad data. We do get them from time to time, but certainly, if we were to see another weakish result in March, then I think that would be a cause for concern. That would certainly indicate that maybe labor market conditions have shifted. Now right now, I'm not particularly concerned about that because when I look at forward looking measures of labor demands, such as job vacancies or the data that we've got at indeed, it indicates that there's still incredibly strong demand for workers across the country. These are jobs that need to be filled, and so you know, given that I think it's unlikely that we're going to see a spike in the unemployment rate in the near term. If anything, I think it'll probably be pretty flat. So things shouldn't change too much.

So just jump into Indeed's data just a little bit. What are you seeing in terms of job postings.

So just jump into Indeed's data just a little bit. What are you seeing in terms of job postings.

So right now, I mean one of the measures that we use is we compare job postings against pre pandemic levels. Now, right now, job postings on Indeed around fifty one percent above pre pandemic levels, so there's still a lot of jobs available on the platform. Now we are seeing a downward trend. Job postings are down around seven point nine percent over the past years, so you know, competition for talenty is certainly easing. It remains pretty strong bio struggle stances and more than strong enough to keep down employment rate low. So that's obviously one of the reasons why I remain pretty optimistic around labor market conditions in the near term.

So right now, I mean one of the measures that we use is we compare job postings against pre pandemic levels. Now, right now, job postings on Indeed around fifty one percent above pre pandemic levels, so there's still a lot of jobs available on the platform. Now we are seeing a downward trend. Job postings are down around seven point nine percent over the past years, so you know, competition for talenty is certainly easing. It remains pretty strong bio struggle stances and more than strong enough to keep down employment rate low. So that's obviously one of the reasons why I remain pretty optimistic around labor market conditions in the near term.

We talk a lot about productivity, and we talk about different sectors and things like that. Starting with the Indeed data, are there areas where sectors particularly that are doing a lot better and others that are doing a lot worse.

We talk a lot about productivity, and we talk about different sectors and things like that. Starting with the Indeed data, are there areas where sectors particularly that are doing a lot better and others that are doing a lot worse.

Absolutely when we look at our data. I mean, you know, the strongest area in terms of job creation or job growth has been in areas such as cleaning and sanitation. There's a range of healthcare roles that sort of also fit into that category. Personal care, so age care, disability care have experienced incredibly strong growth over the past couple of years and remain very strong even today. Now by comparison, there are certainly weaker areas. I mean, job postings for media and communications are down twenty four percent against pre pandemic levels.

Absolutely when we look at our data. I mean, you know, the strongest area in terms of job creation or job growth has been in areas such as cleaning and sanitation. There's a range of healthcare roles that sort of also fit into that category. Personal care, so age care, disability care have experienced incredibly strong growth over the past couple of years and remain very strong even today. Now by comparison, there are certainly weaker areas. I mean, job postings for media and communications are down twenty four percent against pre pandemic levels.

Callum, can't tell me that. I don't know, did you that one?

Callum, can't tell me that. I don't know, did you that one?

Sorry about that? When I saw them data, I thought, oh jeez, you're not happy about anyway, go on. But there's also other areas of weakness. I mean the tech sector, for example, in soft in terms of job creation at the moment, data analytics, which is a sector that deals primarily with AIM and jen Ai, job postings are below pre pandemic levels. Software development ever so slightly above pre pandemic levels. But you know, in comparison to what we are seeing in cleaning and sanitation and the overall job market, you know that they're pretty weak. So there is a big divide between the areas that have the strongest competition for talent and those where, you know, competition for the talent isn't quite so high.

Sorry about that? When I saw them data, I thought, oh jeez, you're not happy about anyway, go on. But there's also other areas of weakness. I mean the tech sector, for example, in soft in terms of job creation at the moment, data analytics, which is a sector that deals primarily with AIM and jen Ai, job postings are below pre pandemic levels. Software development ever so slightly above pre pandemic levels. But you know, in comparison to what we are seeing in cleaning and sanitation and the overall job market, you know that they're pretty weak. So there is a big divide between the areas that have the strongest competition for talent and those where, you know, competition for the talent isn't quite so high.

Stay with me, Callum. We all be back in a moment. I'm speaking to Callum Pickering from Indeed, how are job seekers responding to this environment? So it's okay if you are looking for a job and cleaning and sanitation, personal care some of those sorts of areas, But in tech particular, Tech was one that you mentioned before the break. Are they more people applying for fewer roles or is there just scenes is more competition out there, so the actual people that the company can pick up is better. Like, how's it working?

Stay with me, Callum. We all be back in a moment. I'm speaking to Callum Pickering from Indeed, how are job seekers responding to this environment? So it's okay if you are looking for a job and cleaning and sanitation, personal care some of those sorts of areas, But in tech particular, Tech was one that you mentioned before the break. Are they more people applying for fewer roles or is there just scenes is more competition out there, so the actual people that the company can pick up is better. Like, how's it working?

Yeah, there's an interesting dynamic at play right now. I mean, there is a lot of jobs available, not necessarily in all sectors, but overall, there are still a lot of jobs available, and yet job seekers seem to be more cautious than they were in the past. We've seen job mobility has to climbed recently, and certainly the Great Resignation is definitely over, if it ever truly began. Now. It's interesting because I mean normally, when I look at the job market, I would say, Okay, well, it's still a pretty good job market for the job seekers, right. There's still a lot of opportunities out there. If you're looking for more pay, then there's opportunities to go get at that. But clearly job seekers a prioritizing job security over you and interesting opportunities, which potentially is maybe a little bit of a mistake for some workers and job seekers out there now. Obviously, for specific sectors things can be more challenging. This tech sector is a great example of that. There's been a lot of high profile layoffs in that space. There isn't necessarily as many jobs available as they used to be, so that certainly made things a little bit more more difficult. But overall for the job market, I think this cautiousness around job security is really dominating how job seekers are viewing the market at the moment, and maybe that view is a little bit misplaced given the labor market dynamics that we actually have.

Yeah, there's an interesting dynamic at play right now. I mean, there is a lot of jobs available, not necessarily in all sectors, but overall, there are still a lot of jobs available, and yet job seekers seem to be more cautious than they were in the past. We've seen job mobility has to climbed recently, and certainly the Great Resignation is definitely over, if it ever truly began. Now. It's interesting because I mean normally, when I look at the job market, I would say, Okay, well, it's still a pretty good job market for the job seekers, right. There's still a lot of opportunities out there. If you're looking for more pay, then there's opportunities to go get at that. But clearly job seekers a prioritizing job security over you and interesting opportunities, which potentially is maybe a little bit of a mistake for some workers and job seekers out there now. Obviously, for specific sectors things can be more challenging. This tech sector is a great example of that. There's been a lot of high profile layoffs in that space. There isn't necessarily as many jobs available as they used to be, so that certainly made things a little bit more more difficult. But overall for the job market, I think this cautiousness around job security is really dominating how job seekers are viewing the market at the moment, and maybe that view is a little bit misplaced given the labor market dynamics that we actually have.

What about skills shortages? I mentioned productivity a moment ago. Improving skills should theoretically improve productivity. Are we seeing people reskilling?

What about skills shortages? I mentioned productivity a moment ago. Improving skills should theoretically improve productivity. Are we seeing people reskilling?

That's certainly something so I don't have firm data on that, but certainly anecdotally, that is something that we consistently hear that job seekers, particularly younger job seekers, are really prioritizing upskilling and developing their skills over time as a way to remain competitive in the job market. Now, whether it's working, I don't know. Productivity figures certainly very healthy at the moment, so there's probably something wrong. But certainly from a job seeker perspective, we do consistently see that job seekers are weary that their skills can become obsolete, and so they are putting in that effort to do more training, go through more courses as a way to keep their skills up today.

That's certainly something so I don't have firm data on that, but certainly anecdotally, that is something that we consistently hear that job seekers, particularly younger job seekers, are really prioritizing upskilling and developing their skills over time as a way to remain competitive in the job market. Now, whether it's working, I don't know. Productivity figures certainly very healthy at the moment, so there's probably something wrong. But certainly from a job seeker perspective, we do consistently see that job seekers are weary that their skills can become obsolete, and so they are putting in that effort to do more training, go through more courses as a way to keep their skills up today.

I mean one thing about indeed, you will have some view about what's happening to wages before it actually happens. Obviously, your job's board is going to include that some of that data. At least, do you get a sense that wage growth is coming down growing about normal.

I mean one thing about indeed, you will have some view about what's happening to wages before it actually happens. Obviously, your job's board is going to include that some of that data. At least, do you get a sense that wage growth is coming down growing about normal.

It's certainly weaker than it used to be. I mean, for a couple of years during the early parts of the post pandemic job boom, wages were really strong. That's certainly not the case right now, and we are seeing that across from most sectors. Now, what I think is interesting is that the dynamic there isn't being driven by a lack of competition for talent. I mean, there's still a lot of jobs available, groupment is still quite challenging. I mean, what's happening more is that businesses are sort of pulling it back a little bit in terms of what they believe they can pay. So it's been driven less by labor market dynamics and an inability to fill roles and more so around business conditions, economic conditions and concerns around that. So that's a little bit unusual compared to what we would normally expect to see when the job market is so tight.

It's certainly weaker than it used to be. I mean, for a couple of years during the early parts of the post pandemic job boom, wages were really strong. That's certainly not the case right now, and we are seeing that across from most sectors. Now, what I think is interesting is that the dynamic there isn't being driven by a lack of competition for talent. I mean, there's still a lot of jobs available, groupment is still quite challenging. I mean, what's happening more is that businesses are sort of pulling it back a little bit in terms of what they believe they can pay. So it's been driven less by labor market dynamics and an inability to fill roles and more so around business conditions, economic conditions and concerns around that. So that's a little bit unusual compared to what we would normally expect to see when the job market is so tight.

So what's going to happen to employment over the next twelve months or so?

So what's going to happen to employment over the next twelve months or so?

Con Well, if I knew the answer to that, I probably wouldn't have this job. I'd probably be doing something else. But I think, you know, as I sort of highlighted before, these forward looking measures of labor demand remain really healthy. There are still a lot of jobs available, and normally that should lead to strong employment games over at least the next three to six months. I mean, things can change, but I'd be optimistic around the next three to six months. In terms of employment growth. But if my assessment is right, then I think the uneployment rate should remain quite low. If it does increase, I don't think it'll increase by much. The Reserve Bank of Australia thinks that will end up at about four point two percent by the end of the year. I mean, that's not far removed from the four point one percent we are at the moment, so something like that seems reasonable. But certainly unless we see a big change in these measures of job vacancies and job adds, then I think a spike in the unemployment rate seems unlikely at least this year.

Con Well, if I knew the answer to that, I probably wouldn't have this job. I'd probably be doing something else. But I think, you know, as I sort of highlighted before, these forward looking measures of labor demand remain really healthy. There are still a lot of jobs available, and normally that should lead to strong employment games over at least the next three to six months. I mean, things can change, but I'd be optimistic around the next three to six months. In terms of employment growth. But if my assessment is right, then I think the uneployment rate should remain quite low. If it does increase, I don't think it'll increase by much. The Reserve Bank of Australia thinks that will end up at about four point two percent by the end of the year. I mean, that's not far removed from the four point one percent we are at the moment, so something like that seems reasonable. But certainly unless we see a big change in these measures of job vacancies and job adds, then I think a spike in the unemployment rate seems unlikely at least this year.

And I can't have an economist on the show without asking them about interest rates. What's all this mean for rates?

And I can't have an economist on the show without asking them about interest rates. What's all this mean for rates?

Well, look at a weaker set of labor market figures yesterday probably helps the case for a rate cut at least in the new term. My view is that the IBA will deliver another rate cut. I think either in May or July. I'm leaning towards May, in large part because we get the next quarterly inflation figures at the end of April, so they came out on the thirtieth of April. I think that's going to influence the RBA a great deal. I mean, the RBA will say that they look at a range of different economic data before they make their decision. I think right now they're placing a very high focus on those inflation figures. So if those inflation figures at the end of April come in a little bit weaker, then I think the RBA will pull the trigger again.

Well, look at a weaker set of labor market figures yesterday probably helps the case for a rate cut at least in the new term. My view is that the IBA will deliver another rate cut. I think either in May or July. I'm leaning towards May, in large part because we get the next quarterly inflation figures at the end of April, so they came out on the thirtieth of April. I think that's going to influence the RBA a great deal. I mean, the RBA will say that they look at a range of different economic data before they make their decision. I think right now they're placing a very high focus on those inflation figures. So if those inflation figures at the end of April come in a little bit weaker, then I think the RBA will pull the trigger again.

Callum, thank you for talking to Fearing Greed.

Callum, thank you for talking to Fearing Greed.

Thank you for having me Now.

Thank you for having me Now.

It's Callum Pickering Sen. You're economist at Indeed, this is the Fear and Greed Business Interview. Join us every morning for the full episode of Fear and Greed. Daily business news for people who make their own decisions. I'm Sean A. Elmer. Enjoy your day.

It's Callum Pickering Sen. You're economist at Indeed, this is the Fear and Greed Business Interview. Join us every morning for the full episode of Fear and Greed. Daily business news for people who make their own decisions. I'm Sean A. Elmer. Enjoy your day.