The primary reason why Australia’s unemployment rate cratered to its lowest level in nearly half a century is because Australia’s working aged population grew by around 420,000 people less over the pandemic thanks to the collapse in immigration:
In turn, both unemployment and underemployment would be significantly higher and the employment to population ratio would be much lower (due to an increase in the denominator).
Indeed, Professor Bill Mitchell estimates that Australia’s unemployment rate would have been 6% in August had immigration continued at its pre-pandemic level:
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