Australia’s unemployment rate has risen ever-so-slightly, the Australian Bureau of Statistics tells us, lifting from 3.7 per cent in February 2024 to 3.8 per cent in March. This gentle cooling of the labor market is just what the Reserve Bank of Australia (RBA) wants. But what if the unemployment rate isn’t giving us the full story right now?
There’s an important clue in some data released by online job marketplace SEEK. They release a bunch of fascinating pieces of data on the labor market, and one of the most interesting ones is the number of applications per job advertisement. As you can see from the next chart, that figure has soared.
A slowing economy and rising costs pushed a record number of businesses into insolvency last month, but the overall number of jobs fell by just 6600, supporting data suggesting smaller firms were hit hardest. The unemployment rate edged from 3.7 per cent to 3.8 per cent as people seeking work increased to 20,600, largely driven by migration. The jobless rate is below the Reserve Bank’s indicative forecasts published in February. The jobs data means a 116,500 surge in the number of people working in February was largely retained, boosting the likelihood that interest rates stay higher for longer.
The hopes of millions for mortgage relief will hinge on next week’s inflation figures after a small increase in unemployment confirmed the jobs market remains tight despite continued cost-of-living pressures and lackluster consumer spending. Unemployment drifted up by 0.1 of a percentage point to 3.8 per cent, with the number of people in jobs in March down by nearly 7000. There was a near-21,000 increase in the number of unemployed Australians. The Reserve Bank will have a close eye on next week’s inflation data after unemployment only rose slightly in March.
