Australia’s September jobs report will be released later today.
With home prices falling in many parts of the country, coming at a time when household income growth remains soft and savings levels are very low, labour market conditions will need to stay firm in order to help sustain household spending and overall economic growth in the months ahead.
After a strong increase in hiring in August, economists expect that trend will continue in September, albeit not at the same pace reported one month earlier.
Here’s the state of play:
- In August, employment surged by 44,000 to 12.631 million, breezing past expectations for a smaller increase of 18,000.
- Gains were driven by full-time employment which rose by 33,700, outpacing a smaller lift in part-time employment of 10,200.
- Over the year, full-time employment rose by 202,100, near double the 104,300 increase in part-time workers.
- Total hours worked increased marginally from July, lifting by 0.6 million hours to 1.7509 billion hours.
- Despite the surge in hiring in August, unemployment held steady at a six-year low of 5.3%.
- Labour force participation increased by 0.2 percentage points to 65.7%.
- With the size of the labour force increasing faster than employment, the number of unemployed Australians rose to 708,800, an increase of 5,800.
- While the unemployment rate held steady, broader measures of labour force underutilisation such as underemployment and underutilisation fell.
- Underemployment — measuring the proportion of the workforce with a job but who would like to work more hours — tumbled 0.3 percentage points from May to 8.1%.
- The labour market underutilisation ratio — combining unemployed and underemployed workers — fell by an even larger 0.4 percentage points to a five-year low of 13.4%.
- Some regard underutilisation as a better predictor of future wage pressures.
- In September, economists expect another solid lift in hiring.
- Of the 23 polled by Bloomberg, the median forecast looks for an increase of 15,000. Individual forecasts range from a gain of anywhere between 5,000 to 30,000.
- The unemployment and participation rates are tipped to remain steady at 5.3% and 65.7% respectively.
- For the first time ever, the September report will also contain monthly underemployment and underutilisation estimates from the ABS, providing a more timely indicator on the degree of excess capacity that exists within the labour market.
- Given the RBA regards the unemployment rate as the single-best indicator of labour market conditions, this figure will likely drive market movements in the immediate aftermath of the release.
- The underutilisation figures, along with the split between full and part-time hiring and total hours worked, could also be influential.
The jobs report will be released at 11.30am AEDT.
Business Insider will have all of the details once it hits the screens.
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