Australia’s November jobs report has just been released, and it’s a big beat, finally.
According to the ABS, employment jumped by 39,100 during the month in seasonally adjusted terms, topping expectations for an increase of 17,500.
And the increase was entirely driven by full-time employment.
It rose by 39,300 while part-time employment fell by 200, a good result in anyone’s language.
However, despite the lift in full-time employment in November it has fallen by 22,200 over the past 12 months. Part-time employment, on the other hand, increased by 107,100 over the same period.
At 84,900, total employment growth over the past 12 months was the lowest seen since October 2014.
The unemployment rate increased to 5.7%, up from 5.6% in October, courtesy of a lift in the participation rate to 64.6%.
It previously stood at 64.4%, and was expected to increase to 64.5%.
Both male and female unemployment increased by 0.1%, rising to 5.6% and 5.8% respectively.
Unemployment increased by 17,000 to 725,200, courtesy of the lift in the labour market participation. Essentially, more Australians aged 15 to 64 are now either in employment or are looking for work.
Adding to the strong report, the underemployment rate — measuring those who are currently employed but who would like to work more — tumbled to 8.3%, down from the record high of 8.7% reported in August.
It now sits at the lowest level seen since August 2015.
Underemployment is a measure of labour market slack, and is important as it is influential on wage growth in Australia.
The decline in this figure, along with the rebound in full-time employment, would please policymakers at the RBA, indicating that labour market conditions may not be as weak as previously thought.
The lift in participation fits with this view. At 64.4%, it previously sat at a multi-decade low, largely due to soft labour market conditions in Australia’s mining states.
Despite the lift in the unemployment rate, the labour force underutilisation rate — combining unemployed and underemployed workers — fell 0.2 percentage points to 14.1%.
The improvement was driven by male labour force underutilisation which decreased by 0.3 percentage points to 12.3%. The rate among females held steady at 16.2%.
However, slightly offsetting the improvement seen in these areas, the ABS said that total hours worked in all jobs decreased 10.4 million hours to 1663.3 million hours.
This is somewhat of an anomaly given the strong lift in full-time employment, and will no doubt cast renewed doubt over the veracity of the ABS’ seasonally adjusted figures.
Despite those ongoing concerns, the November jobs report is strong when taken on face value, and suggests that the labour market may be improving after a prolonged period of weakness earlier in the year.
However, further data is required to determine whether or not this is the case.
As the saying goes, one swallow does not a summer make.
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