The Big 4 Look Ahead To Today’s Labour Market Print

The big 4 domestic banks weigh in on the impending April labour market report, which will hit at 11:30 Sydney/02:30 London:

• ANZ: We expect the unemployment rate to have fallen to 3.8% in April (from 3.95% in March) on an employment gain of 30K. Last April, due to Easter being early and during the survey period, there was an exaggerated seasonal effect which saw employment drop against expectations. But given Easter started at the end of the survey period this year, so it should have less of an effect.
• CBA: We expect employment rose by 30K in the month, the unemployment rate declined from 4.0% to 3.9%, and the participation rate remained unchanged at its record high of 66.4%. Hours worked likely picked up in April too given the previous month saw hours worked affected by both COVID‑19 isolation requirements and the floods in NSW and Qld. On the other hand, more people than usual may have taken holidays over the Easter period which would weigh on hours worked.
• NAB: Employment data for April is released on Thursday. The March numbers showed a slowing in employment growth to +18K, and the unemployment rate decreasing a tenth but remaining at 4.0% in rounded terms. For April data, we expect it to show a still-tightening labour market amid buoyant indicators of labour demand. We pencil in a decline in the unemployment rate to 3.8% on the back of employment growth of 40K, though the risk is skewed to a softer outcomes and smaller decline in the unemployment rate. We expect the participation rate to edge higher to 66.5%. Our forecasts are a little stronger than the consensus, which sees +30K for employment and unemployment at 3.9%.
• Westpac: We have revised our employment forecast from +32K to +20K to acknowledge a softer momentum in employment while still allowing for a softer than expected recovery in hours worked. As noted by the ABS, 4.0% is the lowest the unemployment rate has been in the monthly survey. Lower rates were seen in the series before November 1974, when the survey was quarterly. With our forecast for +20K on employment holding the participation rate flat at 66.42% will see a 13K rise in employment with the unemployment rate rounding down to 3.9%