As summarised earlier, the Australian Bureau of Statistics (ABS) today released its labour force report for July, which registered a 24,600 increase in total employment but a flat headline unemployment rate (still 5.2%) due to a 0.09% increase in labour force participation. However, the underemployment rate rose by 0.2% in seasonally adjusted terms.
In trend terms, the unemployment rate rose 0.04% to 5.26%:
Again, total employment rose by a seasonally adjusted 24,600 to 12,908,200. Full-time jobs rose by 34,500, whereas part-time employment increased by 6,700:
The participation rate rose by 0.09% to 66.06%, which is the reason why the unemployment rate was steady despite the decent jobs growth:
Trend jobs growth is softening:
The trend annual growth rate is 2.7%, with full-time employment at 3.0% while part-time employment is growing at 2.1%:
The proportion of the population in full-time work is still tracking near all-time lows:
In July, the major eastern states easily led jobs growth over the past year in seasonally-adjusted terms:
The state seasonally-adjusted figures are notoriously volatile and subject to a big margin of error. As such, the below chart tracks state jobs growth in trend terms. Here, NSW and VIC have once again driven the jobs growth:
SA and QLD have the highest seasonally adjusted unemployment and NSW and VIC the lowest:
The below chart shows the ABS’ more reliable trend unemployment rates, which shows NSW and VIC with the lowest unemployment and TAS, SA and QLD with the highest:
The aggregate number of hours worked rebounded in July, with total hours worked rising 2.0% over the past year:
The below chart, which tracks the annual change in hours worked on a trend basis, paints a mixed picture, with differing growth across jurisdictions and 1.8% growth recorded nationally and falling:
Average hours worked is fading again and has hit the lowest level on record:
Workforce participation is still tracking around all-time highs in trend terms:
The next chart summarises the annual change in the key employment aggregates on a seasonally-adjusted basis, which shows a broadly improved labour market:
Finally, the ABS has switched to monthly reporting of underemployment and labour underutilisation. This shows a trend deterioration over recent months:
Given the strong correlation between underemployment and wages growth, this suggests that wages will remain in the gutter.
Moreover, with the housing market having experienced heavy falls in prices, sales and approvals, and most leading indicators like job ads and business conditions showing weakness, it’s only a matter of time before jobs growth craters and unemployment rises.