MNI DATA IMPACT: Australia Jobless Rate Up, But Employed Jumps

By Lachlan Colquhoun

     SYDNEY (MNI) - Australia's unemployment rate rose to 5.3% on a

seasonally-adjusted basis in January, 0.2 percentage points higher than in

December, despite a sharp increase in the total number of people employed, data

released Thursday by the Australian Bureau of Statistics showed.

     Participation rate rising: Unemployment rose as more people looked for

work, with the participation rate 0.1 percentage points higher at 66.1%, just

off the record high of 66.2% posted in August 2019. Total employment increased

by 13,500 in January.

     Full time jobs the driver: Full time employment increased by 46,200 in

January, more than cancelling out a fall of 32,000 seen in part time employment

as many holiday jobs ended. Employment is now at 13 million, up 1.9% y/y.

     No impact from bushfires: The ABS said there was "no notable impact" on the

January data from the recent bushfires. The agency said the fires disrupted its

data collection in the impacted areas, but did not believe it had any

statistical impact.

     Implications for monetary policy: The Reserve Bank of Australia has

restated full employment is the key objective of monetary policy, and has

suggested it will continue with low rates -- and, if needed, further cuts --

until it is achieved. The latest data, along with recent data showing flat wages

growth, suggests there is still capacity in the labour market and that

employment still needs to increase before upwards pressure is put on wages, and

delivers the increases the RBA seeks.

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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