Jobless rate falls below 5pc for the first time since 2011
The unemployment rate has slid below 5pc for the first time since 2011 but the number of people in full-time jobs also dropped.
Australia’s jobless rate has slid to a new 7.5 year low in February, dropping to 4.9 per cent and defying economist fears of stalling activity in the economy amid a so-called per capita recession.
Official data released on Thursday showed the number of employed Australians rose by 4600 between January and February, forcing the unemployment rate down from 5 per cent.
Although NAB economists noted the unrounded jobless rate was 4.947 per cent, according to the ABS, only just creeping into the 4.9 per cent range.
Economists were expecting a 15,000 rise on-month. According to the Australian Bureau of Statistics, most of the growth in employment was due to a rise in part-time jobs, which rose by 12,000 workers. Meanwhile, the economy shed more than 7000 full time jobs.
The drop was also caused by a drop in the number of people either in work or looking for a job, with the participation rate falling from 65.7 to 65.6 per cent.
The ABS noted severe flooding in northern Queensland state during February affected data collection. The ABS estimated employment growth in Townsville for the February data, and that will be revised once the March data is collected.
Over the last year, the number of full time jobs has grown by 210,000 while part time jobs increased by 74,000.
On a less volatile “trend” measurement of the jobs data, relied on by agencies such as the Reserve Bank, the unemployment rate held steady at 5 per cent.
The rate of young Australians unemployment shifted marginally lower, at 11.2 per cent — more than double the rate of the rest of the population.
On the unsmoothed “seasonally-adjusted” figures, unemployment rose in NSW, from 3.9 to 4.3 per cent and in Victoria, from 4.6 to 4.8 per cent. Economists have raised concerns that the two cities experiencing the most severe property price declines could be impacted by a slowdown in consumer spending, which would feed through to a rise in the jobless figure.
Earlier this month, the December-quarter national accounts showed GDP had risen by only 0.2 per cent, down from an already slow 0.3 per cent in the September quarter. Household spending contributed only 0.2 percentage points to economic growth in the quarter, the same as in the September quarter.
GDP per capita fell 0.2 per cent in the December quarter after a 0.1 per cent drop in the prior three months.
The Australian dollar jumped from US71.37 cents to US71.67c on the lower-than-expected jobless rate but the rise was crimped by the “low quality” of the fall in unemployment and as of 11.42am (AEDT) is trading at US71.53c.
With Dow Jones
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