March employment data suggests continuing weakness in the Australian economy

 

The latest Australian employment statistics suggest continuing weakness in the Australian economy.

The graph from the Australian Bureau statistics on the left shows employed persons. You can see how the seasonally adjusted numbers shot up then down. These stats are very volatile, but its quite a big fall.

A better feel is given by the numbers. In summary:

• Employment decreased 36,100 (0.3%) to 11,592,700. Full-time employment decreased 7,400 to 8,111,300 and part-time employment decreased 28,700 to 3,481,500.
• Unemployment increased 25,900 (3.9%) to 686,900. The number of persons looking for full-time work increased 30,900 to 501,900 and the number of persons looking for part-time work decreased 5,000 to 185,000.
• The participation rate decreased 0.2 pts to 65.1%.
• Aggregate monthly hours worked decreased 5.0 million hours to 1,627.3 million hours.

The graph on the right hand side from unemployment. You can see the kick-up in the seasonally adjusted rate. The unemployment rate increased 0.2 pts to 5.6%.

ABS normally prefers to use trend estimates, because these flatten things out. But both seasonally adjusted and trend show an upwards drift in unemployment.

During the week the Australian currency measured by the trade weighted index reached a new high. So long as quantitative easing continues in certain advanced countries, the dollar is likely to remain high with consequent pressure on domestic economic activity.

With so many Australian workers now on contract work, the fear of unemployment also exercises a downwards effect on spending and on economic activity.