Gloom about the state of the job market deepened in the past three months, indicating consumer spending is unlikely to revive this year.
A Westpac McDermott Miller survey for the March quarter published yesterday showed an index of employment confidence falling below the 100 level for the first time sincethe survey began in 2004.
The index dropped from 104 in the December quarter to 93.2 in the latest period. An index above 100 indicates there are more optimists than pessimists, while a number below 100 indicates more pessimists.
A record net 54 per cent of respondents now say jobs are hard to get, compared with a net 26 per cent in December. A year ago a net 57 per cent said jobs were plentiful.
"Employees don't expect the job situation to improve much over the coming year," Westpac senior economist Donna Purdue said.
A net 28 per cent of respondents still thought jobs would be hard to find in a year, although that was a slight improvement from the December quarter, when it was a net 31 per cent.
"Against the backdrop of perceived poor job opportunities, job security has fallen even further," she said. "That is telling for consumer spending going forward. The less secure people are in their jobs, the more conservative their spending decisions are likely to be."
That conservatism would be worsened by perceptions about current and future earnings, which both recorded big falls in the March quarter after holding up well in December.
A net 23.2 per cent of employees said they were earning more than a year ago compared with a net 38 per cent in December. A net 25 per cent expected to be earning more in a year, down from a net 37 per cent in December.
