Despite concerns that changes to Newstart rules and a lower estimate of the population would produce a one-off boost to the unemployment rate, not much happened in the August job figures released this morning by the Australian Bureau of Statistics — indeed, there was another small but noticeable rise in new jobs, and a fall in the jobless rate.
The seasonally adjusted jobless rate dipped to 6.2% last month, from 6.3% in July. The trend rate (which is designed to smooth out the seasonally adjustment volatility), stayed at 6.2%. There were just over 17,000 new jobs were created (mostly full time for women and men), seasonally adjusted, boosting total employment to more than 11.77 million people. The number of people out of work fell more than 14,000 to 781,000, well under the 800,000 level it hit in July’s report.
On the negative side, the seasonally adjusted labour force participation rate fell 0.1% to 65.0%, and seasonally adjusted monthly hours worked dipped 0.6% in August 2015. And the employment:population ratio was 61% in August, seasonally adjusted, and edged up less than 0.1% to the same level in trend terms. That’s now risen or been unchanged now for eight months in a row.
The rise in the number of people looking for work (work force participation) because of the changes to the Newstart rules, which require unemployed people receiving benefits to be more active in looking for work, failed to eventuate despite predictions from economists.
Unemployment was steady at 6% in NSW but down 0.3 points in Victoria to 6.1% — although Victoria also had a big fall in participation, 0.5 points. Queensland also remained steady at 6.5%; in WA, unemployment fell 0.3 points to 6.1%, while South Australia remained at 7.9%. Tasmania fell 0.2 points to 6.4%, a good result given it had a big rise in participation.
The data continues to reflect the unexpected resilience of the labour market despite tepid economic growth. The economy may be performing below trend (or, perhaps, at a newer, lower trend) but the labour market is performing better than expected, helped by weak wages growth and the kind of “flexibility” that business and conservatives have long insisted simply isn’t there.