Australia’s February jobs report is about to be released.
After creating over 400,000 jobs in 2017, the most in a calendar year on record, economists expect another solid increase to arrive today, continuing the form seen in January.
Adding extra clout to the report, it will also contain quarterly underemployment data, measuring the number of Australians who have a job but who would like to work more hours. Combined with unemployment, this will produce Australia’s underutilisation rate, a figure many regard as being the best measure of available labour supply within the Australian economy.
With wage growth highly influenced by labour supply and demand, economists will be looking to see whether recent strength in hiring has translated into a reduction in underutilised workers, potentially paving the way for stronger wage pressures.
Here’s the state of play.
- In January, employment grew by 16,000 in seasonally adjusted terms. Part time employment surged by 65,900, offsetting a 49,800 drop in full time workers.
- It was the 16th consecutive month that employment increased, the longest stretch in the four-decade history of the survey.
- Reflecting the drop in full time employment, total hours worked fell by 24.1 million hours to 1.7082 billion hours, adding to the 8.6 million decline reported in December.
- With labour force participation falling 0.1 percentage points to 65.6%, the modest increase in employment saw Australia’s unemployment rate fall to 5.5%.
- Reflecting that employment increased faster than the size of Australia’s labour market over the month, unemployment fell by 7,900 to 723,800.
- Australia’s employment to population ratio — measuring those Australians of working age in work — held steady for a second month at 62.0%.
- From a year earlier, full time employment soared by 293,200, outpacing a 110,100 increase in part time employment.
- Combined, total employment rose by 403,300 over the year, the second fastest increase over a 12-month period on record.
- Today, Australia’s record-breaking hiring spree looks set to continue, at least according to every economist surveyed by Bloomberg.
- The median forecast looks for an increase in employment of 20,000. Individual forecasts range from a gain of anywhere between 8,000 to 30,000.
- With labour force participation tipped to hold at 65.6%, the unemployment rate is expected to remain at 5.5%, still above the 5% level most believe it will need to fall below before wage growth begins to accelerate.
- Providing extra information on the outlook for wage pressures, the ABS will also present quarterly underemployment and underutilisation figures.
- When last released in November, underemployment stood at 8.3%, the lowest level since February 2016. Combined with unemployment, labour force underutilisation was reported at 13.7%, still elevated compared to the levels seen before the global financial crisis.
The jobs report will be released at 11.30am AEDT.
Business Insider will have all of the details and implications for interest rates as soon as it hits the screens.