Australia’s unemployment rate in January drops to 6.4 per cent

Australia’s unemployment rate has again fallen, dropping to 6.4 per cent in January. But one state is faring worse than the others.

Australia’s unemployment rate has fallen from 6.6 per cent to 6.4.

The drop comes as 29,000 new jobs were added during the month of January.

New figures from the Australian Bureau of Statistics reveal the number of employed people in Victoria rose 1.3 per cent – the most of any jurisdiction.

South Australia now has the highest unemployment rate, 7.1 per cent, followed closely by Queensland on 7 per cent.

The ACT has the lowest jobless rate at 4.4 per cent.

Full-time employment figures also increased by 59,000 people, while part-time employment decreased almost 30,000, which experts have deemed positive.

Treasurer Josh Frydenberg said the figures had beaten market expectations and were “good news” for Australia.

“We’ve seen the underemployment rate fall to 8.1 per cent – the lowest level since 2014,” Mr Frydenberg said.

“And when you look across the country and the states’ performance, Tasmania is leading the way at 5.9 per cent unemployment.”

Mr Frydenberg said the labour market would continue to be resilient when the JobKeeper wage subsidy ends in March.

“There are regions, there are sectors, there are many Australians who are still doing it tough,” he said.

“But the overall trajectory in our labour market has been in the right direction.”

Josh Frydenberg has welcomed the January unemployment figures. Picture: NCA NewsWire/Gary Ramage

The participation rate – the number of people employed or looking for a job – increased by 0.1 per cent over the month.

Unemployment numbers dropped by 34,300 people, pushing down the 6.6 per cent rate recorded in December.

It is the first time since April 2020 that the unemployment rate sits at 6.4 per cent.

ABS head of labour statistics, Bjorn Jarvis, said labour market continued to recover from the COVID-19 pandemic.

“January 2021 was the fourth consecutive monthly rise in employment, as employment in Victoria continued to recover,” he said.

The number of hours worked during the first month of the year fell 4.9 per cent.

But Mr Jarvis said it was different to the declines across April and May last year.

“After a tough 2020, more Australians than usual took leave in the first two weeks of January, particularly full-time workers,” he said.

“However, the number of employed people who worked zero hours in early January in the capital cities also reflects some ongoing effects of recent lockdowns in Sydney and Melbourne.”

The youth unemployment rate remained at 13.9 per cent in January, while youth participation fell just 0.2 points.

The underemployment rate dropped 0.4 points to 8.1 per cent.

Opposition treasury spokesman Jim Chalmers welcomed the increase in jobs in the economy.

“We also need to recognise that there are millions of Australians who still can‘t find work or can’t find the hours that they need to support their loved ones,” he said.

HOW YOUR STATE FARES

VIC – 6.3 per cent, down 0.2 points

NSW – 6 per cent, down 0.3 points

QLD – 7 per cent, down 0.5 points

SA – 7.1 per cent, up 0.7 points

WA – 6.2 per cent, down 0.1 point

TAS – 5.9 per cent, down 1.1 per points

NT – 5.6 per cent, up 0.2 points

ACT – 4.4 per cent, up 0.7 points

GROUPS REACT TO LATEST FIGURES

Master Builders SA chief executive, Will Frogley, said the soar in unemployment in the state should be a wake up call.

Mr Frogley said construction employed more Australians than any other industry and without a booming residential building sector the rate would “definitely be higher”.

“Longer term state government incentives for investors to build new homes are badly needed to not only create jobs but address the current rental property shortfall,” he said.

“A strong pipeline of commercial building work is absolutely essential and the Marshall Government has the opportunity to make a statement in this year’s Budget.”

MORE TO COME