Miss For Headline Employment On Falling Part-Time Workers

A disappointment when it comes to the headline employment change observed in April’s labour market report, with 4.0K jobs added vs. the BBG median of +30.0K, although 92.4K full time jobs were added, meaning the disappointment was driven completely by a fall in part-time work, which distorts the headline reading if assessed in isolation.

• Elsewhere, participation nudged 0.1ppt lower to 66.3%, which allowed the unemployment rate to tick down to 3.9%. The ABS highlight that “3.9% is the lowest the unemployment rate has been in the monthly survey. The last time the unemployment rate was lower than this was in August 1974, when the survey was quarterly.”
• The underemployment and underutilisation rates managed to lodge another round of fresh multi-year lows, hitting 6.1% & 10.0% respectively.
• When it comes to hours worked, the ABS noted that “seasonally adjusted hours worked increased by 1.3 per cent in April, largely reflecting a bounce back from the March falls in flood affected areas. Hours in New South Wales and Queensland increased in April following the impacts of the floods in March. The number of people working fewer hours than usual due to bad weather dropped from its March peak of over 500,000 to around 70,000 people in April. In line with rising numbers of COVID-19 cases in April, the number of people working reduced hours due to illness continued to be high, reflecting ongoing disruption associated with the Omicron variant. Around 740,000 people worked reduced hours in April because of illness, almost double what we usually saw in April before the pandemic. Of these people, around 340,000 worked no hours, which was around triple what we would usually see.”
• This release won’t move the needle when it comes to RBA policy tightening, with the labour market very tight and continued falls in underutilisation and underemployment boding well for remuneration.