Vacancies rise to record

UNEMPLOYMENT is set to fall further with the number of job vacancies rising to record levels, fuelling speculation of an additional interest price rise.

National job vacancies in the three months to August rose 2.9 per cent, seasonally adjusted, according to the Australian Bureau of Statistics.

Job vacancies rose by 11.9 per cent in the year to August.

CommSec equities economist Martin Arnold said with job vacancies now at a record higher, the unemployment rate was set to fall under four per cent - from its present four.three per cent - as enterprise circumstances encouraged bosses to seek far more staff.

"The Australian economy is recording solid development and organization conditions are practically as very good as they get," he mentioned.

The strength of the economy led a frustrated John Howard to say the public was failing to give the government credit for economic management.

"I consider there is a view in the neighborhood ... possibly a substantial quantity that, for somehow or an additional, our financial strength and our financial stability and growth is taking place naturally, that the economy is on autopilot," the Prime Minister told a public forum at Ocean Grove on the Victorian coast yesterday.

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He said this was 1 of the factors why the government was faring so poorly in the public opinion polls: "I feel folks are starting to take the Australian economy for granted."

Seasonally-adjusted job vacancies totalled 172,700 in the three months to August.

Mr Arnold stated there were fewer than three unemployed individuals for every single vacant job, the lowest level on record.

Enterprise solutions has been one particular of the strongest development places, with 45,200 vacancies, 28.four per cent more than a year ago.

The quantity of positions vacant in the communications industry has much more than doubled to 2800 in the exact same period.

There was powerful demand for labour in the building, retail trade and transport industries.

Places that appear to be significantly less desperate for employees incorporate hospitality, recreation and private solutions.

The public sector is continuing to expand, with the quantity of vacant jobs 11.eight per cent larger than a year ago.

In the year to August, job vacancies in the boom state of Western Australia have been up by 31.eight per cent, unadjusted, followed by the ACT, which was up 31 per cent.

Only Queensland had a decline, with year-on-year vacancies down 3.3 per cent.

Matthew Johnson, the senior economist at broker ICAP, said the rise in jobs vacancies ought to deliver employment development of much more than 2 per cent.

"This signifies that unemployment will possibly fall reduced, and that every person from the Reserve Bank down will continue to fret about wage-push inflation," he mentioned.

High job vacancies and low unemployment is a traditional recipe for inflation, with a limit to how a lot of positions can be filled.

There has, so far, been no evidence of wage inflation, with the typical price of labour increasing broadly in line with costs in the economy. The subsequent inflation figures are published on October 24.

UBS chief economist Scott Haslem mentioned the development in job vacancies would contribute to greater inflation in the final months of 2007. He predicted the Reserve Bank would raise interest prices in February 2008 to stop inflation going above the RBA's 3 per cent target variety.

However Mr Arnold mentioned the increase in labour supply, coming from skilled migration, would not generate wages pressures.