Significant falls in job advertisements in property-related industries led to what's described as the first "non-trivial" decline in NZ-wide job ads since the Delta days of last August.
The latest BNZ/SEEK Employment Report has recorded a 2.7% drop in job ads for June, down from the record levels seen in May.
The labour market has been boiling hot, with shortages of workers and an unemployment rate of just 3.2%.
Reserve Bank Governor Adrian Orr has pointed to the strong labour market as being a key reason why households are going to be able to cope with the much higher interest rates now being seen.
The RBNZ is widely expected to lift the Official Cash Rate by another 50 points next week to 2.5%, with most economists seeing the OCR hitting 3.5% by the end of this year.
Any signs of significant cooling in the till-now super hot work place would give the RBNZ plenty to think about.
BNZ senior economist Craig Ebert was not willing to call the May record job ads figures the 'peak' in the cycle, however.
"...It’s hard to know if this marks a peak in the cycle, let alone the start of a generalised fall. Job ads can bounce around from month to month," he said.
With a housing downturn now in full swing, property and construction industries have started recording very negative sentiment in business confidence surveys.
The May record month for job ads had not shown any particular weakness in advertising for jobs in property-related industries. But June does.
"We noted in last month’s write-up that we were keeping an eye on these aspects, conscious that the housing market is fast losing heat," Ebert said.
"For June, this was borne out by a 19% drop in ads for Real Estate & Property and a 14% fall with regard to Construction."
14 Comments
The bank's "economists" will lose their bonuses unless they talk up the risk side of raising OCR and the subsequent dampening of borrowing from them. Opinions with this amount of bias are worthless. The OCR hikes need to dent the economy much more than this in order to firmly put a lid on inflation. A decrease in listings from a record high is not the prelude to an economic extinction event so cool your jets Craig.
The banks know this - however, if they start the chorus of doubt as early as they can, then maybe Orr's constitution will falter a little sooner and he will capitulate to the BNZ's bottom line.
He probably means hard working agents with carefully cultivated databases of buyers and sellers. It can be hard to believe and there are plenty of lazy and arrogant agents out there, but yes good hard working real estate agents do exist and they do tend to do well regardless of the market.
Quality matters, more than before. As Tony Morgan aptly coined the 'kindergarten covid years' we are now back to reality & it's first job is to balance the bullshit that's being going on for the past two & a half years. It's second job is to rid ourselves of the Hobbits in Wellington. We need a new class of being. Any suggestions?
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