The latest labour market insights followed a hotter-than-expected inflation result, which had economists warning interest rates could be staying higher for longer and a growing chance of a hike in August.
The volume of open roles on offer have been steadily declining from peak levels in mid-2022, Thursday's job vacancy data showed, as global headwinds and higher interest rates buffet the economy.
Yet Australian Bureau of Statistics (ABS) head of labour statistics Bjorn Jarvis said vacancies were still well above their pre-COVID-19 pandemic levels, with around 54.8 per cent more vacancies than in February 2020.
Job vacancies were higher than pre-pandemic levels in 15 out of 18 industries, he said.
"This continued to be particularly pronounced in customer-facing industries, including accommodation and food services, and arts and recreation services, where vacancies are still more than double pre-pandemic levels," Mr Jarvis said.
The Reserve Bank of Australia is expecting the labour market to weaken as higher interest rates work to slow the economy and weigh on inflation.
And while the economy is growing very slowly and various indicators point to a gradually weakening jobs market, price pressures are proving persistent.
The four per cent inflation figure for May released on Wednesday prompted investors to ramp up the rate rise bets and spurred several economists to change their interest rate forecasts.
National Australia Bank now expects interest rates will start to come down from May 2025 - a much longer wait than the previously pencilled-in November 2024.
Katy Gallagher says the government is doing what it can to reduce inflationary pressures. (Lukas Coch/AAP PHOTOS)
"The mix of slow growth and gradual progress on inflation reflects the RBA's decision to embrace a 'lower-for-longer' approach - a lower rate peak compared to other advanced economies, resulting in a longer period at that peak," chief economist Alan Oster said.
A hike at the August meeting was possible, Mr Oster added, but the more likely scenario was that the central bank would leave the 4.35 per cent cash rate unchanged - again - as inflation gradually slows alongside a weakening labour market.Â
A re-acceleration in the monthly inflation gauge, which is volatile and not as comprehensive as the quarterly release, was anticipated in May but the jump exceeded expectations.
The four per cent rise in the 12 months to May took annual inflation to its highest reading in six months and was above the consensus market forecast of 3.8 per cent.
The trimmed mean index rose 4.4 per cent, up from 4.1 per cent in April, but a separate measure of underlying inflation that strips out petrol and other volatile items moderated to four per cent from 4.1 per cent.
Economists warn the latest inflation data could mean a longer wait for interest rate cuts. (Flavio Brancaleone/AAP PHOTOS)
Asked whether the May bump in prices meant an interest rate cut could be ruled out, Finance Minister Katy Gallagher said that while it wasn't the government's job to dictate rate moves its policy setting would help.
"The government's job is to make sure we are doing what we can to put downward pressure on inflation but also trying to help out those cost of living pressures, which you rightly point out is the top issue facing households," Senator Gallagher told ABC radio on Thursday.
The government budget measures starting from July 1 - including tax cuts, energy bill relief and cheaper medicines - will help ease those pressures and should feed through to the cost-of-living index, she added.
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