Advertised salaries rose by 3.5% annually in September, likely boosted by Fair Work’s minimum wage increase. Dr. Blair Chapman unravels the mixed signals from the labor market.
What happens: Job openings rose 0.8% month-on-month in September, with the annual decline slowing to just 1.1%, the slowest pace since November 2022. Retail and consumer products roles, along with trade and services and manufacturing, transportation and logistics, drove the growth.
Why this is important: The data shows that Australia’s labor market may be stabilizing after a prolonged slowdown, although job seekers still face stiff competition.
Australia’s labor market showed signs of stabilization in September, with job vacancies rising modestly even as competition among job seekers reached unprecedented levels, according to the latest data from employment marketplace SEEK.
Retail leads growth
Job openings rose 0.8% month-over-month in September, marking a meaningful shift from recent trends. Growth was concentrated in specific sectors, with roles in retail and consumer products, as well as trade and services and manufacturing, transport and logistics, with strong demand seen contributing to overall growth in the states.
However, professional services showed weakness. Insurance and pensions roles fell 2.9% month-on-month, while banking and financial services fell 1.5%, making them among the five sectors where demand fell.
Dr. SEEK Senior Economist Blair Chapman characterized the market as largely stable but acknowledged ongoing challenges.
“September data shows Australian demand for workers is broadly stable, with vacancies up 0.8%. The annual decline in vacancies has slowed to 1.1%, the slowest since November 2022. However, as the recent rise in the unemployment rate and slowdown in employment growth indicate, the labor market remains challenging,” said Dr. Chapman.
The competition is becoming fiercer
While hiring showed modest improvement, job seekers face increasing competition. The number of applications per vacancy increased by 0.6% in August, the last month for which data is available. This continues an upward trajectory that has pushed candidate engagement to record levels.
“With the number of applications per vacancy also up 0.6% in August, we are seeing increased candidate engagement alongside growing demand, highlighting that the market remains tough for job seekers,” said Dr Chapman.
The trend reflects broader patterns in Australia’s employment landscape. A whopping 78% of applications now come through job boards and advertising channels, a dramatic increase from just 57% in the second quarter of 2022. Job boards dominate, with applications rising to 78% in the second quarter, according to separate JobAdder data published earlier this year.
Salaries inches higher
On the salary front, SEEK’s Advertised Salary Index showed continued growth, albeit at a measured pace. Advertised salary growth rose 0.3% month-on-month in September, the second consecutive month of growth.
Annual advertised salary growth increased slightly to 3.5% year-over-year and remained within the 3.3-3.7% range since October 2024. Dr. Chapman attributed some of the increase to regulatory changes. “After a slowdown earlier this year, following a few weak months of growth, annual advertised salaries increased to 3.5% at the end of September. The Fair Work Commission’s decision to increase the national minimum wage and all modern minimum wages by 3.5% on July 1 is likely to contribute to this increase in advertised salaries,” said Dr. Chapman.
He noted that current conditions differ significantly from the more robust environment of early 2024. “Labor market conditions are no longer as supportive of the quickly announced salary growth we saw in early 2024, with a slowdown in employment growth alongside a decline in participation this year,” Dr Chapman said.
The September figures come as Australia’s employment landscape continues to adapt to changing economic conditions, with companies navigating talent recruitment amid continued cost pressures and changing workforce expectations.
SEEK Managing Director ANZ Kendra Banks previously told Dynamic Business that relevance is crucial to the recruitment process. He stated, “When candidates get relevant matches for their search, and hirers get qualified candidates, perhaps beyond what they expected, the entire process becomes more efficient and seamless for everyone.”
Also read: Four trends that will determine the way we work in 2024
For insight into how AI is transforming hiring processes, read Dynamic Business’s coverage of AI tools for talent acquisition.
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