MNI DATA IMPACT: Australia Unemployment Rate Lower In Dec

--Aussie Jobs Market Driven By Rise In Part-time Christmas Jobs

By Lachlan Colquhoun

     SYDNEY (MNI) - Australia's unemployment rate fell to 5.1% in December,

despite a modest fall in full-time employment levels, data released by the

Australian Bureau of Statistics Thursday showed 

     Other points of note in the data include:

Part-time jobs the driver 

Employment increased by 28,900 overall, with the gains coming solely from

part-time employment as the retail sector, in particular, hired in anticipation

of the Christmas period. Part-time employment increased by 29,200, while 300

full-time jobs were lost.

Participation rate steady 

December's participation rate was steady at 66.0%, meaning that the change in

the unemployment level was due to the increase in employment. Last year, with

the participation rate rising, the unemployment rate moved higher despite

increases in employment. The participation reached a record high of 66.2% last

August.

Underemployment steady 

The underemployment rate, closely watched as an indicator of capacity in the

labour market, and was steady at 8.3% in December. This means that 13.4% of the

Australian workforce is either unemployed or wants to work more hours, down from

13.8% in October.

Implications for monetary policy 

Financial markets are anticipating that the Reserve Bank of Australia will

respond to the recent bushfire devastation with an interest rate cut, although

there is also a counter view -- expressed by the central bank late last year --

that another cut would sap market confidence. The RBA will be pleased to see

that unemployment fell in December, but will understand that the fall came via

part-time Christmas jobs in a retail sector which was hard hit by the bushfires.

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

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