The unemployment rate in Australia has fallen to 3.9 percent, although only 4,000 new jobs were created in April.
Most important points:
- The unemployment rate in Australia has fallen below 4 percent for the first time since the mid-1970s
- But only 4,000 jobs were created last month, which was far below economists’ forecasts
- Underemployment has fallen to its lowest level since the start of the global financial crisis in September 2008
It’s the first time in the history of monthly unemployment rates — dating back to 1978 — that the unemployment rate has fallen below 4 percent (rounded up to one decimal place).
“The last time the unemployment rate fell below this was in August 1974, when the survey was quarterly,” noted Bjorn Jarvis, head of labor statistics for the Australian Bureau of Statistics (ABS).
A revision of the March figures means that the drop to 3.9 actually took place when when unemployment was originally 4 percent†
The ABS figures show that the employment rate has decreased slightly to 66.3 percent, which is the main cause of the fall in unemployment.
Underemployment Drops to Pre-GFC Levels
Better news: The unemployment rate fell again from 6.3 to 6.1 percent, the lowest unemployment rate since September 2008, when the global financial crisis was just beginning to haunt Australia.
“Actually 92,000 full-time jobs were created and 88,000 part-time jobs lost,” NAB economist Ivan Colhoun told ABC News Channel.
Hours worked also rose 1.3 percent last month, reflecting not only a decline in unemployment but also decreasing flood conditions in Queensland and New South Wales last month.
“The number of people working fewer hours than usual due to bad weather fell from its peak in March of more than 500,000 to around 70,000 in April,” noted Mr Jarvis.
However, the number of people who worked reduced hours due to illness remained unusually high, due to continued disruptions caused by the Omicron variant of COVID-19.
“Of these people, about 340,000 didn’t work hours, which was about three times what we would normally see.”
‘No spare capacity’
Sarah Hunter, senior economist at KPMG, said the combination of weak job growth and rising work hours indicates that there are simply very few well-qualified workers out of a job.
“The economy is now effectively running without spare capacity,” argued Dr Hunter.
“Despite job openings remaining at record highs and a higher-than-average number of companies looking to attract people, employment increased by just 4,000 over the month.
“As a result, the unemployment rate has fallen to 6.1 percent, but labor shortages have become a compelling constraint in many sectors.”
dr. Hunter said this should mean workers will soon see bigger pay increases as employers compete for their shifts.
“Given continued strong demand and limited additional domestic labor supply (including the slow recovery of inward migration), it is likely that wage growth will accelerate from here,” she added.
‘Hard to find staff’
Brennen Stewart Allison is the chef and manager of the Beach Hotel in Burnie, in the fringe northwestern Tasmanian seat of Braddon.
The pub has gone back to paying staff double to get them to work on Sundays.
But despite the extra incentives offered, Mr Stewart Allison said it is still difficult to find employees.
“It’s quite difficult to find staff at the moment. That’s probably the biggest problem,” he tells The Business.
He wants the next government to invest in local training and get the long-term unemployed back into work.
“Let’s oppose people who don’t want to work and give them the opportunity, the education and the opportunity to get started,” he said, adding, “but not make it so easy for them to sit at home. “
Larry De’Corso is one of the people who recently got a new job.
The Master of Social Work graduate was admitted to Headspace’s early careers program last year after a few daunting months of job search.
“Yeah, to be honest, it was quite a stressful experience,” they said.
“I feel really privileged to have been given this role. Preventive mental health is such an important area.”
As the job market continues to tighten, Larry De’Corso is optimistic about their future employment prospects.
“In the field where I graduated, there is such a high demand right now, it looks quite positive,” they said.
Despite rising to 8.8 percent, seasonally adjusted, youth unemployment (for people aged 15-24) is still around the level it was just before the global financial crisis.
Posted † updated
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