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Employment records first drop in 3 years
The Australian Bureau of Statistics has revealed the first major fall in employment in three years, which should be of concern considering the RBA’s recent assessments of the national economy.
Employment records first drop in 3 years
The Australian Bureau of Statistics has revealed the first major fall in employment in three years, which should be of concern considering the RBA’s recent assessments of the national economy.
Having previously noted that the Australian economy has reached a gentle turning point, yesterday’s announcement of a decrease in Australia’s workforce by 19,000 might indicate that the economy is still spluttering.
The official unemployment rate is now sitting at 5.3 per cent.
It’s a long way from the 4.5 per cent unemployment rate the central bank has noted as its employment target.
Economist Stephen Koukoulas indicated that previous inaction from the central bank led to today’s announcement.
In a tweet, he said “there is no doubt that the RBA’s failure to cut interest rates in early 2018 and over the following 12 months is costing jobs now in late 2019”.
The monthly trend underemployment rate remained steady at 8.5 per cent in October 2019, an increase of 0.2 percentage points over the past year.
The trend monthly underutilisation rate also remained steady at 13.8 per cent in October 2019, an increase of 0.4 percentage points over the past year.
The seasonally adjusted participation rate decreased by 0.1 percentage points to 66.0 per cent.
ABS chief economist Bruce Hockman said “trend unemployment in October 2019 remained steady at 5.3 per cent, 0.2 percentage points higher than the same time last year”.
“The increase in the unemployment rate over the past year has coincided with a 0.5 percentage point increase in the participation rate, from 65.6 per cent to 66.1 per cent,” he continued.
Also weighing in on the figures was AMP Capital’s head of investment strategy and chief economist, Dr Shane Oliver, who highlighted that the Australian labour market is falling compared with its peers.
“Labour market underutilisation [in Australia] at 13.8 per cent and trending up again, US is at 7 per cent, clearly Australia is a long way from full employment,” Dr Oliver said.
The underwhelming figure led to a reduction in the Australian dollar, which dropped to just US68¢ Thursday afternoon.
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