Unemployment steady at 5.7pc, but jobs growth is part-time, hours worked fall: ABS

Updated

Unemployment has remained unchanged at 5.7 per cent, with the estimated addition of 10,800 jobs last month.

Key points: Unemployment remained steady because participation rate fell to 64.8pc

Hours worked dropped 1.1pc to a record low per worker

SA saw the biggest drop in unemployment, Qld the biggest rise

The Bureau of Statistics figures for April show that a small decline in the proportion of people in work or looking for it helped hold the jobless rate steady, despite relatively weak employment growth.

Most economists agree that Australia generally needs to create about 20,000 jobs a month to keep the unemployment rate stable.

However, slowing population growth and last month's decline in labour force participation meant that 10,800 jobs was enough.

Aside from a drop-off in people looking for work, the data also show that all of the extra jobs last month were part-time.

An estimated 20,200 part-time positions were added, while 9,300 full-time jobs were lost.

Hours worked also dropped a steep 1.1 per cent in April to 1,614 million, seasonally adjusted, backing up a big fall in March.

It is the first time in three years that annual total hours worked has fallen, down 0.5 per cent over the 12 months to April.

Commonwealth Bank economist Gareth Aird said, while the fall in hours worked appears inconsistent with jobs growth, there is a logical explanation.

"The disparity is explained by the big lift in part‑time jobs over the past year," he observed in a note on the data.

"There have been twice as many part-time jobs (161,000) created as full-time jobs (83,800)."

'Quality of jobs generated is deteriorating'

Economists surveyed by Bloomberg had expected unemployment to come in at 5.8 per cent, with the addition of 12,000 jobs in April and steady participation at 64.9 per cent.

While the headline figures appear close to, or even a little better than, expectations, economists are concerned about the type of jobs being created.

Paul Dale from Capital Economics observed that full-time employment has not increased at all over the past three months and that the average number of hours worked per employee per month is at a record low.

"In other words, the quality of the jobs being generated is deteriorating and the amount of work being done is falling," he wrote in a note on the data.

"This supports our view that consumption growth and overall GDP [economic] growth will probably slow this year even if total employment continues to rise at a healthy clip."

SA improves, Qld worsens and NSW still leads state jobs markets

There was some good news for South Australia in the state employment breakdown.

With that state focused more than any other on job concerns, its unemployment rate had a welcome tick down from 7.1 to 6.8 per cent, with participation also a touch higher.

However, South Australia's jobless rate remains the highest in the nation.

The news was not so good in Queensland, which saw a rise in unemployment from 6.2 to 6.5 per cent, and steady participation.

New South Wales remains the state with the lowest unemployment rate, which was steady at 5.3 per cent.

Victoria and Western Australia are the next best performers at 5.6 per cent, but Victoria's rate fell last month while WA's rose.

The two territories continue to have the lowest unemployment rates overall, with the Northern Territory at 4.5 per cent and the ACT at 4.1 per cent.

Topics: economic-trends, unemployment, money-and-monetary-policy, australia

First posted