Recent news coverage of global trade tensions has overshadowed many of the underlying trends present in Australia’s labor market. Constant media attention devoted to the recessionary conditions developing in Europe, the possibility of a no-deal Brexit event, and continued trade disputes visible between China and the United States has damaged sentiment and weighed on economic expectations for 2020.
However, the underlying data figures have yet to display evidence of this deteriorating outlook. Australia’s economy continues to stand out as a beacon of hope for next year’s global growth projections, as the nation as shown excellent progress in its labor market throughout 2019. Overall, the trend remains strong, as Australia’s jobs numbers are quickly approaching record highs.
Encouragingly, the unemployment rate has held steady at 5.2% while the national economy added 41,100 new jobs in the month of July. Impressively, those jobs additions included 34,500 new full-time for the month and this was nearly three-times the figure that was seen in the consensus forecasts of economic analysts.
These jobs additions help drive Australia’s employment rate to reach growth to 62.6% in July (after reaching 62.5% percent in June). This trend is quickly approaching record levels, which were set at 62.9% in 2008. To put this figure into historical context, Australia’s employment rate fell to record lows in April 1983 (at 54%) and averaged 59.02% from the period stretching from 1978 to 2019:
In conjunction with Australia’s rising employment rate, it’s not surprising to see that the nation’s seasonally-adjusted unemployment rate has managed to remain steady at recent levels. Specifically, the country’s unemployment rate has held at 5.2% for the last four months and this has helped to improve the consensus outlook shown in the consensus surveys of analyst estimates. From 1978 until 2019, the national unemployment figure in Australia averaged 6.83%. This figure hit a record high of 11.2% percent in December 1992 and an all-time low of 4% in February 2008.
This shows that the country is currently holding near the lower end of its long-term averages, which is a strong positive for the country’s economy. According to Roland Coombes, labor market analyst at iTouch Resume Services, these comparative data figures support a positive outlook for Australian job seekers heading into next year:
“Recent data from the month of July show that the number of unemployed people in Australia rose by just 800, while a larger total of 41,000 new jobs were created during the same period. Ultimately, this shows that Australia’s job market has actually remained quite robust despite constant reminders of geopolitical turmoil around the world and these encouraging trends have the potential to continue well into 2020.”
In most cases, a strong labor market is what forms the foundational backbone of any national economy, so these figures should be encouraging for anyone looking for a job in Australia. Going forward, it will be interesting to see whether or not these economic trends lead to revisions amongst expert analysts that previously released negative growth projections over the next several months.
Since the Reserve Bank of Australia (RBA) has recently announced a commitment to producing monetary policy initiatives that are more accommodating, it wouldn’t be a significant surprise to see businesses continue to invest in new employee hiring and this could lead to further improvements in Australia’s GDP growth down the road.