After disappointing in the three months prior, Australia’s labour market roared back to life in March with employment growth and unemployment both beating expectations.
According to the ABS, employment jumped by 26,100 after seasonal adjustments, beating forecasts for a smaller increase of 17,000. Total employment now stands at 11.91 million, the highest level on record.
Part time employment rose by 34,900 to 3.7292 million, also the highest level on record. Offsetting that increase, full time employment dipped by 8,800 to 8.1804 million.
Both male and female employment increased during the month, rising by 16,325 and 9,748 respectively.
Over the past 12 months employment increased by 235,300, equating to a percentage increase of 2.01%. Although an impressive number — suggesting average employment growth of 19,600 each month over the past year — the annual percentage increase is below the recent peak of 2.94% struck in November 2015.
Despite the jump in hiring, hours worked fell by 17.5 million to 1,632.3 million hours after seasonal adjustments.
Along with the solid increase in employment, the largest monthly gain since November 2015, the national unemployment rate also fell, dropping to 5.7% from 5.8% in February.
Not only was this well ahead of expectations for an increase to 5.9%, it was also the lowest level recorded since September 2013.
Along with the solid increase in hiring, the decline in unemployment was helped by labour force participation remaining steady at 64.9%, bucking expectations for an increase to 65.0%.
The total number of unemployed also fell by 7,300 to 723,100 persons, the lowest number reported since April 2014. Over the past year the number of unemployed has fallen by 42,900.
Of the states, New South Wales retained the mantle as having the lowest unemployment rate in the country with a steady reading of 5.3% reported in seasonally adjusted terms. Elsewhere unemployment fell in Victoria (-0.3% to 5.7%), South Australia (-0.4% to 7.2%), Western Australia (-0.5% to 5.5%) and Tasmania (-0.1% to 6.8%).
Queensland was the only state that recorded an increase in unemployment, rising to 6.1% from 5.6% in February.
In trend terms, unemployment in rose by 0.1% to 4.5% in the Northern Territory but fell 0.2% to 4.3% in the ACT.
All the key figures from the March report can be found in the chart below.
Though the steady reading on participation and fall in full time employment took some of the gloss off the report, the rebound in total hiring and steady decline in unemployment suggests the improvement in the labour market is continuing, albeit at slower pace than the second half of 2015.
Justine Fabo, an economist at ANZ, called the result “solid”, suggesting that the resilient performance will likely ensure that the RBA keeps that cash rate steady at 2.0% when it meets in early May.
“This will keep the RBA on the sidelines even if inflation prints low,” says Fabo. “We continue to expect the jobless rate to remain around 5.75% for some time, with the risks slightly skewed towards better outcomes over the next few months.”