Seek reports ‘significant reduction’ in job advertisements amid Australian recession fears

The job listings portal Seek has flagged a “significant reduction” in job advertisements, sparking hot competition for a dwindling number of roles.

Revenue derived from Seek’s Australian and New Zealand operations dropped 8% to $840m over the financial year as ad volumes fell 20%.

The recruitment platform earns the majority of its income from organisations who pay to list jobs on its sites.

Weaker than expected job ad volumes weighed heavily on Seek’s overall result as annual earnings fell 13% to $483m, prompting a double-digit sell-down in the company’s stock early on Tuesday.

The chief executive of Seek, Ian Narev, said he expected paid ad volumes to keep falling in Australia and New Zealand this financial year “based on our historical experience of similar conditions”.

There is currently heightened interest in job numbers, with any significant rise in the 4.1% unemployment rate to push Australia closer to a recession. The Reserve Bank factors in the jobless rate when making interest rate decisions.

The Bureau of Statistics will release new jobs data on Thursday.

A jump in the US jobless rate to 4.3% earlier this month triggered volatility on global share markets over fears the world’s biggest economy could fall into recession.

In its recent jobs report, Seek found ad volumes had fallen well over 20% in Victoria and New South Wales, led by weakness in the hospitality, tourism and technology sectors.

This had resulted in more applications per job ad, creating “extremely high” competition for roles.

E&P Capital analyst Entcho Raykovski described Seek’s financials as a “weaker than expected” and noted its “guidance will disappoint”.

Many Australian corporates are now releasing their annual earnings, offering insight into how companies are trying to attract consumers grappling with high living expenses.

While the early pandemic shopping boom saw many retailers expand profit margins by charging customers more, there are now signs consumers have the upper hand.

Retailers Myer and Nick Scali have released subdued figures, while electronics retailer JB Hi-Fi has boosted its discount and promotional activity to retain customers.

Mark Coulter, the chief executive of Temple & Webster, said on Tuesday the furniture and homewares retailer had “bucked the trend” by delivering improved results despite significant cost-of-living pressures on customers.

The retailer recorded a 26% lift in revenue over the financial year, although its profit margins have narrowed.