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Repeats Story Initially Transmitted at 02:05 GMT Apr 19/22:05 EST Apr 18
By Sophia Rodrigues
SYDNEY (MNI) - Australia broke its record pace of growth in employed
numbers in February following a seasonal re-analysis of the labor force data but
the unemployment rate remained unchanged at 5.5% for the third month in a row.
The labor force data for March, published Thursday, showed a softening in
the pace of jobs growth with fall in participation rate and
employment-to-population rate also indicating the labor market may be cooling
slightly. But this follows a strong labor market last year and the easing is in
line with the Reserve Bank of Australia's expectation.
Overall, the data remains supportive of the RBA's monetary policy guidance
for the next move in the cash rate to be higher and market can still price
possibility of a rate hike by the end of the year.
Data published by the Australian Bureau of Statistics Thursday showed the
number of employed persons rose 4,900 in March, falling well short of MNI median
forecast for +22,000. There was a downward revision in February number to -6,300
from originally reported +17,500. The revision follows annual seasonal
re-analysis of the labor force data which resulted in upward revision to January
numbers, and led to slight upward jump for the four-month period to February to
+130,700 from +129,000.
The downward revision in February, however, resulted in a stalling in the
record run of employment growth which until January totalled 16 months.
In the current month, the entire growth was in part-time employment which
offset the fall in full-time employment. Employment-to-participation ratio fell
to 61.9% and was down from a recent high of 62.1% in January. Still, monthly
hours worked rose 4.5 million hours to 1,740 million.
Labor participation rate eased to 65.5%, also down from recent high of
65.7% seen in both December and January.
In the past year, the economy has added 367,000 jobs at a monthly rate of
around 30,500 with full-time contributing 18,900 and part-time contributing
11,600 to the monthly rate.
However, in the four months of this year, the pace of employment has slowed
to a total of 36,000 at an average rate of 9,000.
Still the data remains within the RBA's expectation. But if the pace of
jobs growth continues to slow and pushes up the jobless rate, then it would mean
spare capacity in the economy is increasing instead of decreasing and would
delay the timing of the first hike in the RBA's cash rate.
Note that in the February Statement on Monetary Policy, the RBA said, "It
is unclear whether participation rates will increase further and, if so, by how
much; this represents an uncertainty around the question of how spare capacity
in the labour market is likely to evolve."
Below are key details of the labor force data for March:
(M/M, seasonally adjusted) (M/M, seasonally adjusted)
Employed Persons +4,900 +17,500)
+22,000 (range +10,000 to
MNI Consensus +30,000)
+20,100 (revised from
Full-time Employment -19,900 +64,900)
Part-time Employment +24,800 -47,400)
Unemployment Rate 5.5% 5.5% (revised from 5.6%)
MNI Consensus 5.5% (range 5.4% to 5.6%)
Participation Rate 65.5% 65.6% (revised from 65.7%)
65.7% (range from 65.6% to
MNI Consensus 65.7%)
+7,900 (revised from
Unemployed Persons -2,400 +8,900)
Population 61.9% 62.0% (no revision)
--MNI Sydney Bureau; tel: +61 2-9716-5467; email: email@example.com