Australian Unemployment Rate Climbs as More Join Search for WorkBy
Jobless rate climbs to 5.8%, higher than economists forecast
Participation rate increases for second consecutive month
Australia’s economy added jobs in December, although not enough to prevent the unemployment rate edging up as participation in the workforce increased.
- Employment climbed 13,500 from November, when it rose by a revised 37,100; economists forecast a 10,000 gain in December
- The jobless rate increased to 5.8 percent versus forecast 5.7 percent
- Participation rate climbed to 64.7 percent from 64.6 percent; economists predicted 64.6 percent
- Full-time jobs increased 9,300; part-time employment rose 4,200
- The Australian dollar bought 75 U.S. cents at 12:53 p.m. in Sydney from 75.15 cents before the report
December’s data caps a volatile year for Australian jobs, as declining participation for much of 2016 signaled more spare capacity than improved hiring figures suggested. There is some cause for optimism as participation picked up and full-time roles climbed toward the end of the year. Still, the central bank continues to cite uncertainty over the labor market as a key concern in its outlook for economic growth and inflation.
“The bigger picture is that the labor market still looks fragile,” said Paul Dales, chief Australia and New Zealand economist at Capital Economics Ltd. “While the employment figures are moving in the right direction, any further progress this year will be slow rather than spectacular.”
“The fact that the unemployment rate has moved up from the recent lows and is unchanged over the past six to 12 months does break the improving trend that was in play from late 2014 to late 2015,” said Ben Jarman at JPMorgan Chase & Co in Sydney. “The participation rate is well down over the same period, so the change in trend looks quite fundamental.”
“Overall, the unemployment still remains within a well-worn range,” said Michael Turner at Royal Bank of Canada in Sydney. “With a range of other indicators suggesting hiring intentions remain reasonable, it is hard to conclude that the labor market is deteriorating.”
* Victoria state was responsible for bulk of nation’s 52,500 job gains over last 6 months, adding 48,600 roles; New South Wales saw biggest losses at 9,100
* South Australia continues to have highest jobless by state, with 6.8 percent unemployed