- Australia’s Unemployment Rate Rises in November
The Australian unemployment rate jumped 5.7 percent in November, following worst third quarter economic contraction since the global financial crisis.
Economists had predicted a steady unemployment rate of 5.6 percent.
However, the figure also showed the number of people employed in the month rose by 39,100, with full-time job creation jumping by 39,300 over the month, while the number of people in part-time work fell by 200.
Employment conditions still look shaky with part-time jobs growth in the last year totaling 107,000 new positions, compared with a fall in full-time employment of 22,000.
Still, the lift in employment in November was close to twice that expected by economists, helping to ease some of the worry in markets since recent data showed the economy contracted in the three months to the end of September.
The 0.5% fall in GDP growth in the third quarter was the first decline in five years.
While economists don’t expect a sustained economic slump, concerns about momentum in the economy would grow if unemployment started to rise quickly.
For the Reserve Bank of Australia, the picture around the job market remains clouded. While full-time employment rose in November, hours worked by full-time employees reduced, raising debate about the degree of slack in the job market.
“The underlying trends remain subdued across the board and consistent with our view that the labor market details are weaker than the headline unemployment rate would suggest,” said Su-Lin Ong, chief economist at RBC Capital Markets in Australia.
With little or no growth in wages across the economy, Ms. Ong said it suggests there is little reason to worry about a tightening of the job market just yet.
Paul Brennan, chief economist at Citigroup, said the economy remains uneven as mining states suffer amid a fall in resource-sector investment.
“The RBA has taken a glass half-full view of the domestic data, so on past form is likely to see the jobs data in a positive light,” he said. “But we need to see more employment gains spread more evenly across the states and a decrease in overall spare capacity.”