Westpac write labour market "leading......>

AUSTRALIA: Westpac write labour market "leading indicators have softened, annual

growth in Job Ads is now down through the year but this reflects the structural

shift to other recruitment methods rather than falling employment opportunities.

ABS Job Vacancies growth has slowed from 24%yr in 2018 to 10%yr in 2019 and our

own Westpac Jobs Index suggest firms may be less confident on lifting employment

but it remains consistent with growth around 2.3%yr. Our forecast 8k gain in

employment holds the annual pace at 2.3%yr. Despite the soft print on employment

in Feb, the unemployment rate fell to 4.9% (market median was 5.0%) as a 0.1ppt

decline in the participation rate to 65.6% resulted in a -7.1k decline in the

labour force. At this stage it appears that both male and female participation

is levelling out in a trend sense and we are closely watching where they go

next. We do expect both to edge lower though 2019 as employment growth stalls

but not by enough to prevent a rise in unemployment. Holding the participation

rate flat at 65.6% generates a 31k rise in the labour force, and given our

forecast for a soft 8k rise in employment, this should see the unemployment rate

lift to 5.1%."