Australia: Unemployment drops for the first time in six months
April 10, 2014
In March, the labor market created 18,100 new jobs compared to the previous month in seasonally-adjusted terms, which was down from the 48,200 jobs created in February (previously reported: 47,300 jobs created). The figure reflected a strong expansion in part-time positions (40,200 jobs created), which more than offset the drop in full-time positions (22,100 jobs lost).
The number of people that were actively looking for jobs and found one increased to 29,900, which marked the highest level since August 2010. As a consequence, the unemployment rate fell from 6.0% in February to 5.8% in March, which was the first time that the jobless rate dropped since September 2013. However, the Minister of Employment, Eric Abetz, acknowledged that the reduction in the unemployment rate was mainly due to the fall in the number of people that were actively looking for jobs. Abetz pointed to the fact that the Australian jobless rate might be benefiting from what is known as the “discouraged worker” effect-workers abandoning the active search for jobs-rather than from a real recovery in the labor market.
FocusEconomics panelists expect the unemployment rate to average 5.9% in 2014, which is unchanged from last month's forecast. In 2015, the panel expects the unemployment rate to inch down to 5.8%.