By Wayne Cole
SYDNEY (Reuters) – Australia employment rebounded strongly in October, after a soft patch the previous month, though the jobless rate still ticked higher as more people went looking for work and rapid migration boosted the supply of labour.
Figures from the Australian Bureau of Statistics on Thursday showed net employment rose 55,000 in October from September, more than double market forecasts of 20,000.
The breakdown showed part-time jobs surged 37,900, which could have been boosted by staff hired for a national referendum that was conducted on Oct. 14.
The jobless rate edged up to 3.7%, matching forecasts and largely due to a jump in the participation rate back to an all-time peak of 67%.
Record inflows of migrants and students have boosted the supply of labour to meet demand, so while employment was solid at 55,000 the labour force expanded by an even bigger 83,000.
Over the year to October, jobs growth of a healthy 2.8% was still not enough to match labour force growth of 3.8%.
This expansion of supply means the labour market is not the main driver of inflation and markets see little reason for the Reserve Bank of Australia (RBA) to deliver a follow-up rate hike in December.
The central bank last week lifted rates to a 12-year high of 4.35% and left the door open to another move. Yet futures imply only a 7% chance of a rise in December, and are evenly split on whether the tightening cycle is over for good.
The labour data hinted at some loosening in the market, with the ABS noting annual growth in hours worked had also dropped to 1.7%, from 5% in the middle of the year.
“The recent slowdown in the growth of hours worked may suggest that the labour market is starting to slow, following a particularly strong period of growth,” said Bjorn Jarvis, ABS head of labour statistics.
Vacancies have also been ticking lower as positions get filled. Job ads on Australia’s largest employment site SEEK, fell 5% in October to be 30% below their May 2022 peak, though they remain above pre-pandemic levels.
The RBA itself says liaison with firms has found an improvement in labour availability, along with a decline in turnover rates and hiring intentions.
All of which has lessened the risk of a price-wage spiral, with data this week suggesting wage growth is near a peak after jumping to an annual 4% in the third quarter.
(Reporting by Wayne Cole; Editing by Kim Coghill and Jacqueline Wong)
