Enter Details

Comment on stories, receive email newsletters & alerts.

This is your permanent identity for Business Insider Australia
Your email must be valid for account activation
Minimum of 8 standard keyboard characters


Email newsletters but will contain a brief summary of our top stories and news alerts.

Forgotten Password

Enter Details

Back to log in

The Budget Says Australia's Unemployment Rate Will Rise Next Year


Australia’s jobs market is expected to deteriorate next financial year following a slightly weaker economy, according to forecasts in the 2014 budget.

The economy is forecast to grow slightly below trend, with a large fall in resources investment partly offset by a boost from higher resources exports and the household sector’s response to low interest rates.

By the June quarter 2015 the unemployment rate is forecast to reach 6.25% and remain at this rate until the end of 2016.

The underlying cash deficit is expected to be $29.8 billion in 2014-15, around 1.8% of Gross Domestic Product. This is an improvement on the $33.9 billion projected in the mid-year financial review but is at the higher end of market economist forecasts of $26 billion to around $30 billion.

The deficit is expected to fall to $2.8 billion (0.2% of GDP) in 2017-18. The underlying cash balance is expected to reach surplus around the end of the decade, and by 2023-24 the surplus will reach more than 1% of GDP.

Australia’s economy is in the midst of a major transformation, moving from growth led by investment in resources projects, to broader-based drivers of activity in non-resources sectors.

This is occurring at a time when the economy has generally been growing below its trend rate and the unemployment rate has been rising. However, the near-term outlook for the household sector has improved since the mid-year economic outlook.

Here’s the forecasts according to the budget:

Follow Business Insider Australia on Facebook, Twitter, and LinkedIn