The biggest drop in job ads in more than five years and a sustained slowdown in gross operating profits has underlined expectations the Reserve Bank of Australia will keep interest rates on hold in the lead-up to Christmas.
The ANZ-Indeed Australian job ads index has suffered is biggest monthly fall since June 2018 and has dropped 8.4 per cent in three months in a sign that demand for workers is losing momentum, adding to evidence that the economy is slowing under pressure from high interest rates.
The employment update has come as a separate Australian Bureau of Statistics reports shows growth in company gross operating profits has plunged in the past 18 months.
After growing at an annual rate of more than 28 per cent in mid-2022, they shrank by 1.3 per cent in the September quarter to be 1.7 per cent smaller than a year earlier.
Expectations of a December interest rate hike had already been pared back after figures released last week showed the annual inflation rate eased to 4.9 per cent in October and many economists think the central bank board will keep the official cash rate at 4.35 per cent when it meets on Tuesday.
Markets have put the odds of a December 5 rate rise at just 2 per cent.
But the members of Australian National University's RBA Shadow Board are virtually evenly divided on whether or not monetary policy will be tightened, collectively putting the odds that a hike to 4.6 per cent is the right move at 49 per cent.
Shadow Board chair Timo Henckel said that although headline inflation was easing, business confidence was softening and the labour market was "showing first cracks", underlying price pressures were still growing much faster than the central bank was targeting and the housing market "continues to show strength".
"The Shadow Board's current view of monetary policy is on a knife's edge," Dr Henckel said, including putting marginally higher odds of a rate hike than a rate pause in the next six months.
But the longer-term outlook is more promising for borrowers. The Shadow Board thinks there is almost a 50 per cent chance that lower rates will be the most appropriate policy setting a year from now.
The possibility of higher interest rates, even if they are delayed until next year, will be unwelcome for millions of families already struggling with surging living and loan repayment costs.
Even with the federal government's energy bill rebates, the average household electricity bill has jumped $520 in the past year and gas charges are up $388 over the same period, according to price comparison service Mozo.
The pressure on the federal government to do more to relieve cost-of-living pressures is intensifying, with some urging it to use next week's mid-year budget update to announce more assistance.
But Treasurer Jim Chalmers has against sought to tone down expectations.
Dr Chalmers told a media conference at Parliament House that the defining feature of the financial statement will be "responsible economic management".
The Treasurer said the government's handling of its finances was helping to put downward pressure on inflation.
"We understand and recognise that people are under substantial cost of living pressure but we are making welcome and encouraging progress in this fight against inflation," he said, adding that the government was "still rolling out substantial parts" of its $23 billion assistance package.
But shadow treasurer Angus Taylor accused the government of making the inflation problem worse and claimed "this government has the wrong priorities".
"It's making bad decisions and Australians are paying a very high price for that," Mr Taylor said, arguing it should make reducing living costs and interest rates "its highest priority".