MNI BRIEF: Aussie Unemployment Rises To 4.1%

Australian unemployment in January rose to 4.1% m/m from December’s 3.9%, higher than the 4.0% expectation, while employment grew by 500, lower than the 25,000 market estimate, data from the Australian Bureau of Statistics showed.

Bjorn Jarvis, ABS head of labour statistics, noted January coincided with a higher-than-usual number of people who were not employed but who said they will be starting or returning to work in the future. “This may be an indication of a changing seasonal dynamic within the labour market, around when people start working after the summer holiday period,” he said.

Seasonally adjusted monthly hours worked also fell by 2.5 per cent in January. “Since October 2023, the annual growth rate in hours worked has slowed considerably, down to 0.7% in January 2024, and well below the annual employment growth of 2.6%,” Jarvis added.

Strong wage growth and sluggish productivity have impeded the Reserve Bank of Australia’s inflation fight. (See MNI: Productivity, Wages Keep Pressure On RBA - Ex Officials) The Reserve wants the unemployment rate at 4.4% by mid-2025.