New ABS data painted a complex picture of the job market in November, with generally good news on employment despite slight rise in unemployment.
The unemployment rate climbed to 3.9% in November (seasonally adjusted), up from 3.8% in October.
This represents a 0.1% increase, driven by a rise of 19,000 in the number of unemployed people, despite a strong 61,000 increase in overall employment.
Bjorn Jarvis (pictured above), head of labour statistics at the ABS, noted the continued strong employment growth but highlighted the concurrent rise in unemployment.
“This combination pushed the participation rate to a new high of 67.2%, while the employment-to-population ratio reached a record 64.6%.”
Jarvis emphasized the persistence of high employment levels throughout 2023, with the ratio fluctuating between 64.4% and 64.6% since February.
Similarly, participation rates remained elevated, with the number of unemployed people increasing by 81,000 over the past year. However, he pointed out that both unemployment measures remain significantly below pre-pandemic levels.
While employment continued to climb in November (0.4%), hours worked saw a more modest increase of less than 0.1%. Jarvis attributed this to a slowdown in hours growth observed over the past six months, bringing the total number of hours worked back to May 2023 levels.
He acknowledged the strong growth experienced in late 2022 and early 2023 but emphasised the recent narrowing gap between employment and hours growth, suggesting a potential easing of the tight labour market.
Coinciding with the slowdown in hours worked, the underemployment rate rose 0.2 percentage points to 6.5% in November.
This represents a 0.7% increase from November 2022 but remains 2.2% lower than pre-pandemic levels. The underutilisation rate, encompassing both unemployment and underemployment, also rose 0.3% to 10.4%.
Trend data revealed a stable picture, with the trend unemployment rate holding steady at 3.8%. Both employment (0.2%) and hours worked (-0.1%) exhibited modest trend growth, while the employment-to-population ratio and participation rate remained at 64.6% and 67.1%, respectively.
The underemployment and underutilisation rates also held firm at 6.4% and 10.2%.
“In trend terms, many of the key indicators still point to a tight labour market. However, the increasing unemployment rate since November 2022, along with the rising underemployment rate and slowdown in hours growth, may suggest that the labour market is starting to slow," Jarvis said.
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