Australia’s hiring strength persists as unemployment steady

AUSTRALIA’S strong hiring extended into August and the unemployment rate held steady, underscoring the resilience of the labour market to elevated interest rates.

Employment rose 47,500 – driven by part-time jobs – versus a forecast 26,000 gain, Australian Bureau of Statistics (ABS) data showed on Thursday (Sep 19). The jobless rate was unchanged at 4.2 per cent, while the participation rate held at a record high.

“The high employment-to-population ratio and participation rate shows that there are still large numbers of people entering the labour force and finding work, as employers continue to look to fill a more than usual number of job vacancies,” said Kate Lamb, ABS head of labour statistics.

The report comes days before the Reserve Bank of Australia (RBA) is widely expected to leave its key rate at a 12-year high of 4.35 per cent and maintain its hawkish rhetoric. Money markets and economists reckon the RBA’s next move will be a cut, though they are divided on the timing. Traders see a first reduction in December while economists’ consensus shows easing will only begin in 2025.

The market’s view is at odds with governor Michele Bullock, who has all but ruled out rate cuts in the near term. Bullock, who describes the RBA’s current policy settings as restrictive, will have an opportunity to share her views on the employment data, among other issues, at a press conference after Tuesday’s policy announcement.

Thursday’s report also showed:

• Annual jobs growth eased to 2.7 per cent in August from 3.2 per cent a year earlier.
• Full-time roles fell by 3,100 while part-time surged 50,600.
• The employment-to-population ratio rose to 64.3 per cent, just shy of a record high set in November last year.
• Underemployment edged up 0.1 point to 6.5 per cent.
• Hours worked rose 0.2 per cent from a month earlier. BLOOMBERG