Full time jobs lift
- Employment rose by 39,100 in November after rising by 15,200 in October (previously reported as rise of 9,800 jobs). Full-time jobs rose by 39,300 while part-time jobs fell by 200. Economists had tipped a 15,000 increase in jobs. Hours worked fell by 0.6 per cent in November to be up just 0.1 per cent over the year.
What does it all mean?
The headline employment result was certainly encouraging. Over 39,000 new jobs were created in November and the unemployment rate is still holding just shy of three-year lows. And even more encouragingly the growth was in full-time jobs. Overall it is clear that the labour market has been largely marking time over the last few months, with the dampener being the fall in hours worked in November. In fact hours worked is only up 0.1 per cent on a year ago.
Given the month-to-month volatility it is better to look at the longer term results. And in that regard, employment has totalled almost 132,000 in the year to November, compared with over 358,500 in the same period last year. And the results are markedly more polarising when you compare the growth in full-time jobs.
Full-time jobs growth has gone backward by almost 45,800 so far in 2016 compared with jobs growth of almost 158,400 in the same period last year. It is clear that a slowdown in hiring has taken place.
However the outlook is certainly more encouraging. Job vacancies are holding near 4-year highs, in addition anecdotal evidence suggest activity levels amongst the business sector is lifting. The strength in commodity prices is also a positive and may be behind the strength in Queensland jobs growth. Almost 39,000 new jobs were created across the Queensland economy in November. It is still early days but the latest result is certainly more upbeat.
What do the figures show?
- Employment rose by 39,100 in November after rising by 15,200 in October (previously reported as a fall 9,800 jobs). Full-time jobs rose by 39,300 while part-time jobs fell by 200. Economists had tipped a 15,000 increase in jobs.
- Hours worked rose by 0.9 per cent in October – fastest in five months. Hours worked are up by 0.9 per cent on the year.
- The unemployment rate rose from 5.6 per cent to 5.7 per cent in November. To two decimal points the jobless rate rose from 5.60 per cent to 5.71 per cent. The trend unemployment rate was steady at 5.6 per cent (hasn’t been lower in 3½ years). The participation rate rose from 64.4 per cent steady at 64.6 per cent.
- A total of 131,600 jobs were added over the year to November. The annual growth rate eased to a 25-month low of 0.7 per cent. In trend terms, employment rose by 3,100 in November.
- The working age population rose by 23,800 in November. The working age population rose by 284,900 (1.47 per cent) over the last year – fastest growth in 21 months.
- Unemployment across states in November: NSW 4.9 per cent – 4-year lows (October 4.9 per cent); Victoria 6.0 per cent (5.7 per cent); Queensland 6.0 per cent (5.8 per cent); South Australia 7.0 per cent (6.5 per cent); Western Australia 6.9 per cent (6.5 per cent); Tasmania 6.4 per cent (6.3 per cent). In trend terms unemployment in the Northern Territory was steady at 3.7 per cent; ACT unemployment rose from 3.6 per cent to 3.7 per cent.
- Jobs across states and territories in November: NSW +5,600; Victoria +1,100; Queensland +38,600; South Australia +200; Western Australia +7,400; Tasmania +2,000. Trend terms: Northern Territory +300; ACT +100.
Why is the data important?
- The Labour Force estimates are derived from a monthly survey conducted by the Bureau of Statistics. The population survey is based on a multi-stage area sample of private dwellings (currently about 22,800 houses, flats, etc.) and a sample of non-private dwellings (hotels, motels, etc.). The survey covers about 0.24 per cent of the population of Australia and includes all people over 15 years of age, except defence personnel.
- If more people are employed, then there is greater spending power in the economy. But at the same time companies may adjust the work hours of employees. If employees work less hours, and therefore get paid less, then spending power in the economy is reduced.
What are the implications?
Australian economy is emerging from a mid-year pause. Looking ahead, there is reason for optimism. A number of hurdles have been cleared like the US election; job ads are rising; home building is at record highs; the Chinese economy continues to record firm growth, as does the US economy.
Official interest rates are on hold. It is not clear whether the next interest rate move is a rate hike or rate cut – but there looks to be no need to change rates for some time. But borrowers need to be on guard to the risk of higher fixed-term rates after recent increases in global bond yields.
More people coming to our shores, getting jobs, spending and being taxed, ensures that our economy will continue to grow.