A gauge of Australian job vacancies surged to a new pandemic-era high, cementing expectations that the labor market will tighten further as competition among firms for workers intensifies.
Job ads shot up 8.4% to 228,170 positions in February, ending two consecutive monthly falls due to disruptions caused by the omicron variant of coronavirus, an Australia & New Zealand Banking Group Ltd. survey showed Monday. Help-wanted notices are up 46.3% versus January 2020, before coronavirus hit.
Australia’s central bank is holding interest rates at a record low of 0.1% as policy makers test how far they can push down unemployment — currently 4.2% — before triggering faster wages growth. The bank has signaled it’s not persuaded that inflation has returned sustainably to its 2-3% target for inflation and wants to see stronger pay gains before it begins raising rates.
Birch said the reopening of Australia’s international borders last month would further add to demand for goods and services, boosting already strong economic momentum.
“As such, competition for labor is likely to remain elevated,” she said. “Given our upgraded labor market outlook, the shift in bargaining power towards employees and higher inflation expectations, we should see wage growth accelerate convincingly through 2022.”
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