Today (April 18, 2024), the Australian Bureau of Statistics released the latest – Labour Force, Australia – for March 2024, which shows that the labour market is weakening with employment falling and unemployment rising now that more normal patterns in behaviour after the holiday period disruption have returned. The good news is that full-time employment continued to rise but was more than offset by the loss of part-time work. The stronger full-time outcome meant that underemployment fell marginally. The rise in unemployment would have been worse had not the participation rate fell. The drop in both employment and participation is a signal of weakening. There is still 10.3 per cent of the available and willing working age population who are being wasted in one way or another – either unemployed or underemployed and that proportion is increasing. Australia is not near full employment despite the claims by the mainstream commentators and it is hard to characterise this as a ‘tight’ labour market.

Today (March 21, 2024), the Australian Bureau of Statistics released the latest – Labour Force, Australia – for February 2024, which shows that the weakening we observed over the holiday period has reversed and was probably due to variations in flow behaviour over the break that has become evident since the pandemic. As I noted in the January analysis, the changing holiday behaviour that has become evident (many people now working zero hours in January) makes it difficult to be definitive about the February result, which is excellent. Employment growth was strong as those zero-hour workers resumed work and the net job creation easily outstripped the rising participation rate. The drop in unemployment is a boost as is the drop in underemployment. However, there is still 10.3 per cent of the available and willing working age population who are being wasted in one way or another – either unemployed or underemployed and that proportion is increasing. Australia is not near full employment despite the claims by the mainstream commentators and it is hard to characterise this as a ‘tight’ labour market. The return to a 3.7 per cent unemployment – the level that was very stable in the period since mid-to-late 2022 makes a mockery of economists who think that interest rate hikes would always push up unemployment. And with unemployment and inflation falling, the current unemployment rate cannot be below some NAIRU, which also makes a mockery of the the RBA’s stated research and policy logic. The reality is that inflation has fallen as the supply factors abate and the interest rate hikes were totally unnecessary.

Today (February 15, 2024), the Australian Bureau of Statistics released the latest – Labour Force, Australia – for January 2024, which confirms a weakening in the labour market. The signs of a slowdown were appearing in late 2023 and the January figures probably confirm that trend, although the changing holiday behaviour makes it difficult to be definitive. We will know more next month when the holiday period effects wash out. Employment growth was unable to even keep pace with the underlying population growth, which is why unemployment rose with participation constant. The best indicators that the labour market is weakening are the fall in the employment-to-population rate since November 2023 (down 0.5 points) and the sharp decline over the last few months in hours worked. It also appears that the slowdown is impacting teenagers disproportionately. There are now 10.7 per cent of the available and willing working age population who are being wasted in one way or another – either unemployed or underemployed and that proportion is increasing. Australia is not near full employment despite the claims by the mainstream commentators and it is hard to characterise this as a ‘tight’ labour market.

Today (January 18, 2024), the Australian Bureau of Statistics released the latest – Labour Force, Australia – for December 2023, which tells us where things were at by year’s end. This looks likes the first real signs of a slowdown although the rather large swing in participation suggests there is some sampling variability and the incoming rotation group for December 2023 did have a lower participation rate than the outgoing group. Employment growth has been unusually strong in the previous few months but has now turned negative. Without the very sharp fall in participation, the official unemployment rate would have been 4.5 per cent rather than the official recorded rate of 3.9 per cent – a difference of 98.3 thousand workers. While we will see whether the data will be revised next month, a substantial number of workers who may have been or become unemployed have left the labour force in December as the demand-side weakened. There remains 10.4 per cent of the available and willing working age population who are being wasted in one way or another – either unemployed or underemployed. Australia is not near full employment despite the claims by the mainstream commentators and it is hard to characterise this as a ‘tight’ labour market.

Today (December 14, 2023), the Australian Bureau of Statistics released the latest – Labour Force, Australia – for November 2023. Employment growth remains strong with a surprise uptick in full-time employment. With participation rising by 0.2 points, the increase in the labour force outstripped the strong employment change, which meant that the unemployment rose by 0.1 points. If the participation rate had not have changed, then the official unemployment rate would be 3.5 per cent rather than the official rate published of 3.9 per cent. Underemployment also rose – there are now 10.4 per cent of the available and willing working age population who are being wasted in one way or another – either unemployed or underemployed. Australia is not near full employment despite the claims by the mainstream commentators and it is hard to characterise this as a ‘tight’ labour market.