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Australia’s September jobs report stunned financial markets today with the ABS reporting a fall in employment of 5,100. The figure, well below August’s 18,072 gain and expectations for a further increase of 7,100 for September, was the first month since April that employment had fallen.

The decline left employment growth over the past 12 months at 230,100, an increase of 2%.

Curiously, all of the job losses came from full-time work, which declined by 13,900. As explained by the smaller decline in the headline employment figure, part-time workers increased by 8,900.

In what will no doubt raise doubts over the reliability of the data yet again – something that received renewed focus today – all of the job losses were concentrated in male employment. It fell by 13,163, something that was partially offset by a 8,113 increase in employment among females.

Despite the surprise dip, the unemployment rate held steady at 6.2% courtesy of a 0.1% decline in labour force participation to 64.9%. The ABS reports that the number of persons in the labour force declined by 13,200, the largest fall recorded since August 2014. Male labour force participation fell by 9,500 while that for females dipped by 3,700. As a result of the dip in labour market participation, the number of unemployed persons decreased by 8,100 to 772,500.

From a states and territories perspective, the unemployment rate fell in New South Wales (-0.1% to 5.9%), Queensland (-0.1% to 6.3%), South Australia (-0.2% to 7.7%) and Tasmania (-0.4% to 6.0%). In Victoria unemployment edged up 0.1% to 6.2%, while Western Australia held steady at 6.1%. In trend terms, unemployment in the Northern Territory rose by 0.2% to 4.9% while in the ACT it increased 0.2% to 5.1%.

All of the key numbers from the report can be found in the chart below.

So what to make of the September jobs report? On face value its weak. Employment fell, entirely from the full time workers, while the number of persons in the labour market also declined, allowing the unemployment rate to hold steady at 6.2% – hardly inspiring stuff.

However, the report is hardly reflective of trends seen in alternate labour market indicators, both public and private. They’ve been steadily improving over the course of this year.

Markets certainly decided to look through the weak report, largely ignoring the release. As of 12.30pm AEDT the Australian dollar was sitting up for the session at .7320, along with the ASX 200, which put on 0.41%. Even cash rate futures have fallen, pointing to a reduced likelihood of the RBA cutting interest rates in the months ahead.

Clearly there’s some scepticism among investors towards the month-to-month volatility of the seasonally adjusted data. In trend terms the ABS reported that employment increased by 12,400 with the unemployment rate holding steady at 6.2%. This fits with other labour market surveys, and sounds about right all things considered.

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