Job seekers face fierce competition as number of applicants skyrockets

Job seekers face fierce competition as number of applicants skyrockets
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By Susan Edmunds, RNZ Money Correspondent

Bad news if you are in the market for a new job: You are likely to face more competition than you would have in years.

ANZ data on the number of job applications per advertisement shows a more than 250 percent increase since 2019.

There was a spike in 2020 as the first Covid lockdown hit, but applications then fell away before increasing rapidly from 2023.

ANZ senior economist Miles Workman said that was evidence that the labour market was becoming significantly weaker, even though the unemployment rate had not increased sharply.

"There is very convincing evidence now that the labour market is loosening," he said.

"The number of job applications per ad has definitely moved to very loose territory."

ANZ's data showed that in May there was a drop, year-on-year, of more than 30 per cent in the number of job ads posted.

Seek said the level of applications per job was "exceptionally high".

That was particularly true for roles in manufacturing, transport and logistics, construction, and trades and services.

Trade Me said the number of applications per ad was up 15.4 percent in the most recent quarter, compared to the previous three months.

Workman said it was possible that there was some "labour hoarding" happening. It had been suggested that businesses were now more willing to carry reduced margins to be able to hold on to staff who would be hard to replace.

"When the pandemic hit and we didn't know what the impact was going to be, we thought there would be a material downturn. On that news alone some businesses reduced headcount.

"Then we had all the stimulus and firms found it very hard to find labour. The unemployment rate hit a record low as far as modern data is concerned and that lesson has reverberated in recent years."

He said job losses were unlikely to be at the same level as in the global financial crisis, but were still expected to hit.

"If demand is softer, it doesn't make sense for firms to hold on to workers, particularly if they are feeling confident they can hire again."

Unemployment reached as high as 6.4 percent in 2012. Most forecasts are for a peak this cycle about one percentage point below that.