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Australia’s unemployment rate to rise in December, participation rate to fall

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 13, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    FXStreet (Mumbai) - Australia will release its December jobs report tomorrow. The jobs market is believed to have weakened in December. Markets broadly expect unemployment rate to rise to 5.9 per cent in December after having decreased to 5.8 per cent in November. November’s unemployment rate was the lowest since May 2014.

    In November, the economy had added 71,400 jobs, the largest gain since March 2012, while the number of unemployed had declined by 2,800. In October too the jobs report was strong. October saw 56,000 jobs being added. The October-November figures suggested that the growth in these months was the strongest two-month period of employment growth since the 1980s.

    Unemployment Rate averaged 6.96 per cent from 1978 until 2015. It reached an all-time high reading of 11.10 per cent in October of 1992 and a record low of 4 per cent in February of 2008.

    Westpac noted the previous unemployment data suggested that sample rotation likely helped in boosting employment in November. It was also argued by Westpac that if November’s increase in employment was really the impact of sample rotation and not on account of stronger underlying trend, there will be a correction of sorts in December. Westpac thus estimates a rise in unemployment rate. Leading indicators studied by Westpac led it to suggest that total employment growth could be around 2 per cent yr as against the ABS' 3 per cent yr.

    Participation rate is expected to come in at 65.2 per cent. November had seen participation rate rise from 65.0% to 65.3%. The current participation rate, as pointed out by Westpac is around the average seen since 2008 March.

    It must be noted here that the number of jobs advertised in Australia remained mostly flat in December after having risen for four months in a row. The ANZ Job Advertisements Series showed job listings slipped by 0.1 per cent in December. In December, online job ads fell by 0.1 per cent, while job advertisement posted in newspapers fell by 1.2 per cent. a dip in job ads last month further backed analysts’ estimates that unemployment will rise slightly in December.
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