A small rise in the number of new jobs was outweighed by a sharp rise in the number of people unemployed, pushing the unemployment rate up to 4.3% in September, up 0.2% from August.
Figures today from the Australian Bureau of Statistics show that there was a sharp fall in full time jobs, offset by an increase in part time employment, suggesting that some workers are being shifted to fewer working hours as the domestic economy slows.
The ABS said that full time employment rose 2,200 (seasonally adjusted) to 10,737,400 as full-time employment fell 15,400 to 7,706,800 and part-time employment increased by 17,700 to 3,030,500. The fall in full time employment reversed the 7,000-plus seen in August. The number of people looking for part time work was more than double the August number, suggesting that employers are looking to trim full time hours.
The news had little impact on a weak stockmarket which was down around 1.8% just before midday after falling 2.4% in early trading. Tokyo was off a touch after Wednesday’s bone shaking 9% plunge.
The ABS said that September’s outcome was after the number of people employed in August was revised down to 10,200 extra jobs from the original surprise estimate of 14,600. Our performance, below recent levels admittedly, was still a lot better than the US September outcome of 159,000 jobs lost and several hundred thousand people leaving the workforce and hundreds of thousands of others being put on shorter hours or weeks.
But the September report from the ABS adds to the growing impression that pressure on employment is rising, as companies like GM, Qantas, Fairfax, Clipsal, Southern Pacific Tyres and others either cut employment levels or prepare to do so. Small resource groups, Perilya and CBH have together cut well over 600 jobs from their mines at Broken Hill and at Cobar in western NSW. Boeing, Starbucks and the ANZ Bank have also announced cutbacks.
Several other smaller Western Australian mining operations have also laid off staff after closing or cutting back production in recent months as metal prices have tumbled.
Unemployment jumped by 21,700 in the month to 479,600 with the number of people looking for full-time work up 4,400 to 326,800 and the number of people looking for part-time work increasing by 17,300 to 152,800.
With the participation rate steady at 65.1%, the end result was a rise in the unemployment rate 4.3% in September from 4.1% in August, with male unemployment rate rising by 0.2% to 4.0%, and the female unemployment rate by 0.2% to 4.6%.
The employment numbers reinforce the decision by the RBA to cut interest rates this week. Without the global turmoil, the central bank would have cut rates by 0.25%. Employment clearly reacted to the slowing pace of activity in the economy. Those resource job cuts are only small at this stage but will be followed by more from metal miners where price falls have hurt. The sharply weaker Australian dollar (it was trading around 66 US cents this morning after dropping 10% overnight) will provide some cushioning from the sharp drop in oil, copper and other metals. Gold prices have held up.
The September Labour Force report was compiled by the ABS using a sample of businesses that was cut by 24% in July as a cost saving (as was the size of the sample for retail sales). The Bureau, which reduced the survey because of budget cuts, has warned that the cuts will increase the volatility of the figures.