Australia's Unemployment Rate Is Worse Than We Thought

Image: Gettty.

Australia’s unemployment rate has been revised up to 6.2% from 6.1% for September.

Unemployment data over the past few months has been wild, with significant bounces month to month. In July the ABS shocked markets with a surprise surge in Australia’s unemployment rate to a decade high of 6.4%.

In August the bureau’s stats showed a surprise fall 6.1%, with an almost unbelievable 121,000 jobs added against market expectations of 15,000 jobs.

Today the Australian Bureau of Statistics released an explanation for why the job numbers between July and September were so unstable.

In August the ABS’ investigation into the matter identified no specific cause – it wasn’t until the September numbers were being processed that the seasonally adjusted estimates became more pronounced, resulting in the bureau concluding that the seasonal patterns weren’t operating as expected for July, August and September and it set seasonal factors to one for the estimates.

The ABS said, “The movements between July and August 2014 for the seasonally adjusted employment series, especially part-time employment, were very large but again were not unprecedented. However, if the seasonal factors based on the previously observed seasonal pattern had been applied to September, there would have been a large fall in employment, more than offsetting the large rise in August.”

The volatility had markets not taking the numbers seriously and sparked some great reactions. More on that here.

The ABS identified several possible reasons for seasonal pattern changes, including changes to the timing and content of its surveys, including implementing digital submissions and a new labour force questionnaire.

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