Today will be as good as it gets for the Government for a very long time.
The Coalition is in disarray, its polling its near record highs, and now the feared surge in unemployment has failed to materialise for another month. The November labour force figures show only a marginal increase in unemployment with 15,000 more people looking for work. While there was a small drop in the participation rate, an unemployment rate of 4.4% at the moment will be the object of international envy. There was even an increase in full-time female employment in seasonally-adjusted terms.
Better yet, the eastern state economies are holding up. Western Australia was the main source of the rise in unemployment — albeit to a dreadful 3% — while basketcase NSW recorded a slight fall to 5.2% and Queensland and Victoria held steady.
The numbers are the first hard evidence that the Government’s strategy of trying to stay ahead of the financial crisis by maintaining confidence and priming the economy early has worked. Based on these numbers, with the input of rate cuts and the stimulus package, domestic demand and employment may hold up well into the new year.
However, with Chinese exports falling and Rio Tinto slashing its workforce here and overseas, the bottom seems about to fall out of international trade, probably more than enough to dwarf the benefits of a lower Australian dollar. 2009 is looking dire in terms of employment, beyond the capacity of any government to fully address.
Still, the better-than-expected unemployment number might do something to combat the sapping effect on consumer confidence of a steady drip of stories about lay-offs and retrenchments across the economy. We’re still enjoying low unemployment, even if it may not last. The Government can go into the summer break satisfied that it has done pretty much all it could to prevent, or at least delay, the onset of recession, and make it shorter and milder if and when it hits.