Australia’s jobs report for June has just been released, and it’s yet again good news.
According to the Australian Bureau of Statistics (ABS), employment increased by 14,000 in seasonally adjusted terms, coming in a shade under expectations for a rise of 15,000.
While a tiny miss, that was more than offset by the news that full-time employment surged by another 62,000 to 8.356 million, continuing the trend seen in recent months.
Explaining the modest headline increase in hiring, part-time employment fell by 48,000 to 3.81 million over the same period.
Combined, total employment rose to 12.167 million, the highest level on record.
At nine, the current stretch of uninterrupted monthly employment gains is the longest since January 2011.
Over the past year employment increased by 240,200, the fastest pace of hiring since January 2016. At 2.01%, the percentage increase was the fastest since April 2016.
Full-time employment rose by 175,400, outpacing a smaller increase in part-time employment of 64,800 over the same period.
The annual increase in full-time employment was the largest since December 2015. In the year to September 2016, it had fallen by as much as 50,600.
Quite the turnaround.
By state, the ABS said the largest increase in employment was in Western Australia at 6,900, followed by South Australia and Victoria at 4,600 and 3,700 respectively.
With full-time employment continuing to grow at a breakneck pace, total hours worked by all employees jumped rose by 0.5% to 1.7035 billion hours.
Over the past year, total hours worked increased by 53.9 million hours, driven largely by an increase in full-time hours of 44.0 million hours.
The national unemployment rate held steady at 5.6%, in line with expectations, largely due to the participation rate increasing to 65%.
Despite the modest lift in hiring, with more people looking for work the number of unemployed Australians rose by 13,100 to 728,100.
By state and territory, the unemployment rate in Tasmania fell by 0.5 percentage points, the largest decline across the country in June. Victoria and South Australia also saw unemployment levels fall, offsetting increases in Queensland and Western Australia.
Elsewhere New South Wales retained the title as having the lowest unemployment rate at 4.8%.
This table from the ABS has all the details how individual states and territories fared.
Despite the small miss in headline employment growth and steady unemployment rate, other than that there’s little not to like in the June jobs report.
Full time hiring surged again as did total hours worked.
That’s significant as they were two factors that the RBA mentioned specifically in the minutes of its July monetary policy meeting.
“Growth in the preceding few months had been driven entirely by full-time employment and that total hours worked had trended higher as a result,” the minutes read.
The bank also said that recent jobs data had “removed some of the downside risk” in its forecasts for wage growth.
Today’s report will do little to alter that view. Indeed, if anything, it’ll likely strengthen it.
“The surge in full-time jobs in June is likely to fuel growing expectations that the RBA will begin to raise interest rates by the first half of 2018,” said Kate Hickie, Australia and New Zealand economist at Capital Economics.
However, while the jump in full-time hiring signals that labour market conditions have strengthened, Hickie says it’s still likely to be some time yet until the RBA feels confident enough to hike interest rates.
“Despite this latest improvement, there is still plenty of excess capacity in the labour market, which will keep a lid on wage growth,” she says. “As such, we expect that interest rates will remain on hold until 2019.”
Callum Pickering, APAC economist at Indeed, agrees with that assessment.
“The recent improvement in labour market conditions provides some justification for a more hawkish Reserve Bank,” he said. “However, considering the upcoming challenges and the ongoing weakness in wage growth, there is no urgency to hike rates.”
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