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Seek Ltd (ASX:SEK)’s earnings report, given its role as a jobs board, can offer interesting insights into the Australian labour market – and what we’re seeing is an easing of the pace at which the jobs ad market is slowing down.
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That news, among a general story of growth reported by the company on Tuesday, has been enough to add 1.6% in Tuesday morning trades. Its activities in Asia are expanding; ANZ’s growth prospects remain fairly desirable, and Seek still retains the benefit of multiple broker ‘buy’ ratings.
But it’s what it had to say about the Australian jobs market on Tuesday which could perhaps give us insight into what the RBA will be looking at next – regardless of if it cuts or pauses on Tuesday.
That the rate at which job advertisements have been declining is slowing down could point towards a ‘floor’ for the labour market (so as to say things aren’t going to get much worse), while the unemployment rate is still 4.1%.
In that universe, with ‘sticky’ unemployment at 4.1% (if you will), it’s presumable the RBA would be forced to either continue leaving rates on hold or maintain a disciplined approach with cuts, while that base of inflationary pressure remains stagnant.
Still, even with the jobs market, Australia’s disinflationary journey is still on track.
And, as for the jobs market, Jobs and Skills Australia predicts the RBA to see its ideal unemployment rate of 4.5% met sometime in the middle of the 2025 calendar year.
Notably, the agency also expects there to be two million more jobs in the economy by 2033 than there are now. So what has appeared to be a post-COVID-19 irregularity in the labour market wholemeal – coupled with Australia’s aging but elsewhere growing population – could be another ‘new normal.’
Just as long as TMI keeps coming down.
SEK last traded at $24.62 per share.
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