Services growth best in 18 years as sector beats doldrums
Australia’s services industry is growing at its fastest pace in almost 18 years as the sector extends its recovery from the doldrums of last year’s coronavirus-induced recession.
The Australian Industry Group performance of services index rose by 0.2 points to 61.2 in May, its highest monthly result since October 2003.
Ai Group chief executive Innes Willox said there was particular strength in logistics, business and property, and retail trade and hospitality services.
“Across the services sector, sales and employment grew impressively and input costs, wages and selling prices continue to rise at a steady clip,” Willox said.
The data was complied before the latest COVID-19 lockdown in Victoria.
“Although new orders for services grew strongly in May, close attention will now be on the impacts of the latest cluster of cases and the Victorian lockdown on business sentiment in the weeks ahead,” Willox said.
Other figures due to be released on Monday will show whether upbeat demand for workers more broadly continued in May.
ANZ will release its latest monthly job advertisement report.
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Job ads rose a further 4.7 per cent in April to a 12-year peak and were 27.8 per cent higher than their pre-pandemic level.
Another strong reading will back Treasury secretary Steven Kennedy’s hopes that people who have lost their jobs as a result of the JobKeeper wage subsidy ending will quickly find employment in coming weeks.
Addressing a Senate hearing last week, Dr Kennedy estimated that some 56,000 people lost jobs in the four weeks following the JobKeeper scheme ending in March.
Back in March, he had predicted that up to 150,000 people could lose their jobs.
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