Australia’s jobless rate unexpectedly climbed in January despite a surge in full-time employment as more people hunted for work.
Unemployment rose to 5.3% last month, compared with economists’ estimate of 5.2%, data from the Australian Bureau of Statistics showed Thursday. The participation rate increased to 66.1% and 13,500 jobs were added last month, slightly exceeding forecasts.
“The labour market started 2020 on a weak note,” said Callam Pickering, an economist at global jobs website Indeed Inc. who previously worked at the central bank. He said the data do not reflect the impact of the coronavirus shutdown on export and import industries and warned, “there is a real risk that the unemployment rate spikes in the coming months.
The data extends a three-year run of hiring strength that has withstood volatility offshore and a slowdown at home. Yet the job market’s health has failed to push unemployment lower and wages higher as it coincided with a swelling labour force. This led the Reserve Bank of Australia to cut rates three times last year to buttress investment and drive faster growth and inflation.
The further easing of rates has delivered few results outside reinvigorating house price growth. Governor Philip Lowe maintains “long and variable lags” in monetary policy mean it will take time for stimulus to work its way through the economy. He maintains rising property prices are a necessary forerunner to an eventual recovery in residential construction and households feeling wealthier will be more inclined to spend.
Other data released in the report painted a mixed picture.
- Full-time jobs climbed by 46,200 while part-time roles fell by 32,700; indeed, in the past three years more than three-quarters of new jobs have been full-time positions
- Underemployment climbed 0.3 percentage point to 8.6%
- Monthly hours worked decreased by 8.1 million, or 0.4%