Australia’s Unemployment Rate Steady at 4.2% with Increase in Part-Time Employment

September 19, 2024 TruthUSA

The quantity of individuals working full-time decreased.

Australia’s unemployment rate remained stable at 4.2 percent in August, as per seasonally adjusted Australian Bureau of Statistics (ABS) data.

There is a growing number of Australians entering the job market, and they are working more hours per month.

Nevertheless, the amount of people working part-time went up by 50,600, while full-time employment declined by 3,100.

Overall, the statistics revealed on Sept. 19 indicated that nearly 14.5 million Australians were employed in August.

The number of employed individuals rose by 47,500, while those without a job decreased by 10,500.

“This led to the unemployment rate staying steady at 4.2 percent and the participation rate remaining at its highest ever of 67.1 percent,” mentioned ABS head of labor statistics Kate Lamb stated.

Monthly hours worked grew by 0.4 percent, slightly above the 0.3 percent employment increase.

The percentage of people working fewer hours than usual due to economic factors, such as lack of work or reduced availability, is lower than pre-pandemic levels, Lamb noted, indicating ongoing tightness in the labor market.

Underemployment Rate Increases

At the same time, the underemployment rate went up by 0.1 percentage point to 6.5 percent. However, this is still lower than during the pandemic.

Moreover, the underutilization rate, which combines unemployment and underemployment, remained steady at 10.6 percent.

The ABS emphasized that this is significantly less than the 13.9 percent recorded in March 2020 before COVID-19 restrictions were put in place.

“The employment and participation metrics are at historically high levels, while unemployment and underemployment figures remain low, especially in comparison to pre-pandemic times. This indicates a relatively tight labor market,” Lamb mentioned.

Banks React to Data

Reacting to the findings, ANZ Senior Economist Catherine Birch remarked that employment exceeded expectations.

Birch reiterated ANZ’s forecast that the Reserve Bank of Australia (RBA) won’t begin to lower interest rates until February 2025.

“Although we anticipate the RBA to commence easing in February 2025, the risks now seem to lean towards a later start rather than an earlier one, especially given the current labor market momentum,” she remarked in a research note to investors.

Meanwhile, ING Bank stated that it is premature to draw conclusions about the implications for RBA policy.

The devil is in the details, they noted, adding that the robust headline employment growth “was all from the part-time sector.”

“These roles, which tend to be lower paid and less secure, with fewer benefits and perks, will have a smaller impact, job-by-job, on household spending than growth in full-time employment,” ING explained, highlighting the decrease in full-time positions.

Labor Spotlights Employment Achievement, Coalition Disagrees

Work Minister Murray Watt and Treasurer Jim Chalmers stated that the labor force statistics indicate that nearly one million jobs have been created since the Albanese administration took office.

“This is a commendable achievement against the backdrop of a slowing economy and a softer job market. It speaks to the efforts of Australian workers and employers, demonstrating the responsible way in which we’re managing the economy,” they stated.

“Our legislations have brought in new rights for workers—the right to disconnect, stronger safeguards for gig workers, and additional benefits for casual employees.

“We are witnessing the largest number of employees covered by newly approved enterprise agreements in over ten years.”

However, Shadow Treasurer Angus Taylor argued that Labor inherited a robust job market from the Coalition, and that the claims made by Labor regarding the job market don’t align with how Australians are feeling.

“After two years under Labor, real incomes are declining and unemployment is increasing. Youth joblessness is on the rise, and the social services caseload has grown,” he remarked.

“For working Australians, it feels like they can’t keep up because their expenses and mortgages keep rising.”

This situation leaves small businesses grappling with skill shortages and the public sector overshadowing private enterprises.

“Government spending and migration are the only things keeping the economy and job market afloat—and that is not indicative of a robust economy,” he asserted.

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