Here’s why the SEEK Limited (ASX: SEK) share price might be getting a boost today. (Hint: It might have something to do with more job ads).
The post Seek (ASX:SEK) share price lifts as jobs ads reach 12-year high appeared first on The Motley Fool Australia. –
The SEEK Limited (ASX: SEK) share price is continuing its upwards trend today following the release of Australian job advertisement data for March. At the time of writing the job marketplace provider’s shares are trading 3.16% higher at $29.75 a share.
Highest Job ads since post-GFC
On a day for good news, the Australia and New Zealand Banking GrpLtd (ASX: ANZ) reported another strong gain in job ads for the month of March. Reportedly, job advertisements in Australia increased by an additional 7.4% month-on-month, or 39.7% compared to this time last year.
As a result, job ads have hit a 12-year high – with the number reported not seen since November 2008. At that time Australia, and the world, was climbing out of the global financial crisis (GFC). Twelve years later, the world is clambering to recover from a crisis of a different kind – although economically the fallout is comparable.
The positive monthly growth makes for the tenth month of consecutive increases in job ads. A figure that has SEEK shareholders smitten, as the share price continues to exceed pre-COVID-19 levels.
SEEK share price and job ads break pre-pandemic levels
At 190,542 ads, positions looking to be filled have now exceeded pre-pandemic levels by roughly 52% when compared to January 2020. Unsurprisingly, SEEK and its share price have come along for the ride, being Australia’s number one employment marketplace.
A year on from a drastic 42% crash, the SEEK share price has now gained 108% in the last 12 months. Prior to the pandemic, the company’s share price hit an all-time high of $24. As of today, the company’s shares are trading 24% beyond that previous high.
Although job ads might be growing, the prior half remained challenging for the company. Group revenue lagged 6% compared to the prior corresponding period, while net profit after tax slumped 8% to $69.7 million.
A promising sign for unemployment
Job ad data in conjunction with the Reserve Bank of Australia’s (RBA) commentary remains optimistic for unemployment. This afternoon the RBA maintained the cash rate at 0.1%. Adding that Australia’s economic recovery has been stronger than expected with unemployment falling to 5.8% in February.
High job ads and a falling unemployment rate are certainly promising indicators for a healthier job market looking ahead. Given the prosperity of the job market is closely tied to SEEK’s share price success, this might have a bit to do with the recent lift.
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Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia has recommended SEEK Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.