By Shane Wright
The chances of a surprise pre-Christmas interest rate cut have all but evaporated after new figures revealed the jobs market continuing to surge and a record 10 million Australians holding down full-time employment.
Before key inflation figures next week, which are expected to show price growth at its lowest rate since the depths of the pandemic, Australian Bureau of Statistics data showed unemployment steady at 4.1 per cent in September.
The participation rate – the proportion of people in work or looking for it – reached an all-time high of 67.2 per cent with 64,100 people getting work in the past month.
Full-time jobs formed the bulk of the increase in total employment, at 51,600, while part-time positions were up by 12,500.
For the first time, more than 10 million Australians are now holding down a full-time job. Over the past year, total employment has climbed by 434,000 of which 253,000 have been full-time.
But the spread of new jobs across the states and territories is not even.
While NSW’s unemployment rate fell to 3.8 per cent, it added just 18,800 full-time jobs over the past year. The total number of jobs in the state has increased by 115,600.
Victoria’s jobless rate edged down to 4.4 per cent while its participation rate reached a record high of 68.5 per cent. A year ago, it was 67 per cent.
The state added almost 122,000 full-time jobs over the past year and another 30,000 part-time positions. But the state’s female unemployment rate lifted to 4.9 per cent compared to 3.6 per cent a year ago.
Queensland created almost as many total jobs as NSW, of which 63,900 have been full-time.
Employment Minister Murray Watt said more than a million jobs had been created since the government came to office in 2022.
“This is the most jobs ever created in a single parliamentary term by any Australian government,” he said.
“This is a remarkable achievement in the context of a slowing economy and a labour market that’s expected to soften.”
But Liberal employment spokeswoman Michaelia Cash said that “behind the figures” there were concerning trends.
“The jobs growth is now happening in the public sector, not the private sector,” she said.
Financial markets had believed there was a chance the Reserve Bank could use its pre-Christmas meeting in mid-December to deliver a surprise rate cut. But that evaporated after the stronger-than-expected job figures.
EY senior economist Paula Gadsby said next week’s September quarter inflation figures would give a clearer indication of how quickly price pressures are easing across the economy.
“But with the labour market operating at a level above full employment, the Reserve Bank remains alert to the risk the strong jobs market poses to inflation – especially if productivity growth remains weak. This is one of the key reasons the Reserve Bank is not ready to lower the cash rate just yet,” she said.
AMP economist My Bui said the unemployment rate – which has been around 4.1 per cent for six months – remained low despite strong population growth and a slowing economy.
“While cost-of-living pressures may have pushed more households to enter the labour force to look for work, the fact that many of these people are still able to be matched to jobs is a good outcome for job seekers,” she said.
“The data confirmed the RBA’s worries that the elevated level of aggregate demand in our economy is still above supply, and absent a material weakening in trimmed mean inflation or household consumption, the Reserve Bank will likely retain its current hawkish position until next year.”
Cut through the noise of federal politics with news, views and expert analysis. Subscribers can sign up to our weekly Inside Politics newsletter.