Tag: Employment

More Data Pushing Rate Cuts Out, as Labour Markets Hold Up (Again)!

On Thursday Australia’s jobless rate rose to 3.8 per cent in March, which was broadly in line with the market’s expectations, and ahead of crucial March quarter inflation data due next Wednesday. The economy added 27,900 full-time roles and lost 34,500 part-time jobs in the month.

This very slight rise in the unemployment figure to 3.8 per cent last month showed February’s unexpected drop to 3.7 per cent was not an aberration after all. It’s further evidence of the continued strong state of the Australian labour market.

So, forget rate cuts for now, as this can only make it harder for the Reserve Bank to consider any start to rate cuts in the foreseeable future. Reserve Bank governor Michele Bullock’s mantra is that the path of interest rates will depend on the data. And this is one more data point indicating the resilience of the economy. Actually, despite record immigration, the employment-to-population ratio fell marginally in the month but is still at close to the historically high levels of last year.

This continues what I think is a really wonky series on employment, as I have discussed before. As in many economies, thanks to sample issues, and definitional issues they are hard to read. Indeed, Australia’s labor market report is a volatile series and both economists and policymakers tend to look through month-to-month fluctuations. So, Thursday’s data was widely anticipated following holiday season-affected readings since December. The ABS noted that employment flows have now returned “to a more usual pattern” after recent instability. The incoming and outgoing samples this time around were certainly a little less volatile. But I still take the results with a truck load of salt!

http://www.martinnorth.com/

Go to the Walk The World Universe at https://walktheworld.com.au/

Today’s post is brought to you by Ribbon Property Consultants.

Digital Finance Analytics (DFA) Blog
Digital Finance Analytics (DFA) Blog
More Data Pushing Rate Cuts Out, as Labour Markets Hold Up (Again)!
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The Employment Numberwang Continues…

The unemployment rate rose by 0.1 percentage point to 3.9 per cent in November (seasonally adjusted), up from a revised 3.8 per cent in October, according to data released today by the Australian Bureau of Statistics (ABS).

The ABS said: “With employment increasing by 61,000 people, and the number of unemployed people rising by 19,000, the unemployment rate rose to 3.9 per cent in November.

“The combination of strong growth in both employment and unemployment in November saw the employment-to-population ratio return to a record high of 64.6 per cent and the participation rate reach a new high of 67.2 per cent.

“We have continued to see employment growth keeping pace with high population growth through 2023. The employment-to-population ratio has been high for a long time now, between 64.4 per cent and 64.6 per cent since February 2023, and between 64.3 per cent and 64.6 per cent for the past 18 months.

“Similarly, participation continues to be high. In addition to strong employment growth over the past year, the number of unemployed people has also increased by around 81,000 people, and the unemployment rate has risen by 0.4 percentage points. However, both unemployment measures remain well below their pre-pandemic levels.”

At this point just note that from September 2023, the ABS sample frame has been updated with information from the 2021 Census, with sample selection from the new sample being phased in over eight months from September 2023 to April 2024.

And specifically, The ABS has revised the original Labour Force series from July 2016 to reflect the latest estimated resident population (ERP) based on the 2021 Census (final rebased ERP). So the usual resident civilian population in October 2023 was revised up by around 0.2% (around 37,200 people).

To add to the data tweaks, the incoming November sample had a higher unemployment rate and higher participation, which also helps to explain some of the slightly weird movements this month.

This helps to explain why while employment growth continued into November 2023, rising by 0.4 per cent, monthly hours worked rose by less than 0.1 per cent.

http://www.martinnorth.com/

Go to the Walk The World Universe at https://walktheworld.com.au/

Today’s post is brought to you by Ribbon Property Consultants.

Digital Finance Analytics (DFA) Blog
Digital Finance Analytics (DFA) Blog
The Employment Numberwang Continues…
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The RBA May Have More To Do – If You Believe The Employment Numbers!

Australian employment came in much stronger than expected in October while the jobless rate edged higher as more people sought work, suggesting the RBA may have more to do to cool demand and inflation.

As Warren Hogan said: The RBA released updated economic forecasts less than a week ago which were finalised on 7 November – 9 days ago. They forecast employment growth in Dec 2023 of 2.5%. After todays labour force numbers they need employment to fall by 10k in each of November and December to achieve this. If you use quarter average YoY then you need an even bigger fall – something like a net fall of 50k in Nov/Dec. either way the economy keeps surprising on upside and their models will be screaming higher rates. It is their judgement and/or the board that is holding rates down.

On the other hand, a Sluggish increases in hours worked and declining job ads suggest that demand for workers is weakening along with the economy. Given record growth in the working-age population, something will have to give.

That said, Markets largely shrugged off the data. “Today’s figures don’t provide enough of a ‘smoking gun’ for a follow-up rate hike at the December board meeting and that seems to also be the market reaction,” said Diana Mousina, deputy chief economist at AMP Ltd.

“Another rate hike is still a possibility for February 2024 after the next round of quarterly inflation data, but we think the macroeconomic environment will be weaker” by then, she said.

New RBA Governor Michele Bullock recently described the labor market as “not as tight as it was,” noting that some leading indicators such as job vacancies have begun to ease from high levels.

But when you examine the data, we have more questions than answered, and as I discussed on my Tuesday live show, I wonder if the data as presented by the ABS really portrays the current state of employment. My surveys suggest that people are grabbing extra hours and jobs where they can, to help alleviate the costs of living, and of course with population growing thanks to high migration, we need at least 22,000 new jobs each month, just to stand still.

My best guess is the ABS is not picking up the huge immigration surge quickly enough. It is clear the labour market has dramatically loosened. As I say, something will have to give.

http://www.martinnorth.com/

The RBA May Have More To Do – If You Believe The Employment Numbers!

Australian employment came in much stronger than expected in October while the jobless rate edged higher as more people sought work, suggesting the RBA may have more to do to cool demand and inflation.

As Warren Hogan said: The RBA released updated economic forecasts less than a week ago which were finalised on 7 November – 9 days ago. They forecast employment growth in Dec 2023 of 2.5%. After todays labour force numbers they need employment to fall by 10k in each of November and December to achieve this. If you use quarter average YoY then you need an even bigger fall – something like a net fall of 50k in Nov/Dec. either way the economy keeps surprising on upside and their models will be screaming higher rates. It is their judgement and/or the board that is holding rates down.

On the other hand, a Sluggish increases in hours worked and declining job ads suggest that demand for workers is weakening along with the economy. Given record growth in the working-age population, something will have to give.

That said, Markets largely shrugged off the data. “Today’s figures don’t provide enough of a ‘smoking gun’ for a follow-up rate hike at the December board meeting and that seems to also be the market reaction,” said Diana Mousina, deputy chief economist at AMP Ltd.

“Another rate hike is still a possibility for February 2024 after the next round of quarterly inflation data, but we think the macroeconomic environment will be weaker” by then, she said.

New RBA Governor Michele Bullock recently described the labor market as “not as tight as it was,” noting that some leading indicators such as job vacancies have begun to ease from high levels.

But when you examine the data, we have more questions than answered, and as I discussed on my Tuesday live show, I wonder if the data as presented by the ABS really portrays the current state of employment. My surveys suggest that people are grabbing extra hours and jobs where they can, to help alleviate the costs of living, and of course with population growing thanks to high migration, we need at least 22,000 new jobs each month, just to stand still.

My best guess is the ABS is not picking up the huge immigration surge quickly enough. It is clear the labour market has dramatically loosened. As I say, something will have to give.

Digital Finance Analytics (DFA) Blog
Digital Finance Analytics (DFA) Blog
The RBA May Have More To Do - If You Believe The Employment Numbers!
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More “Announcables” To Look Good And Do Little!

I have discussed before the spate of announcables from the current Government – events and releases which give the impression of taking bold actions which grab headlines, but which in reality signifies very little at all. Housing was a standout example, but now we have another, the jobs plan.

Which in fact was a scene resembling The Hollowmen. It took 260-pages and six cabinet ministers to announce the jobs plan, and according to Jim Chalmers he wants to reduce the non-inflationary jobless rate so 2.8 million people who are not working, or wanting to work more hours, can bolster the labour market and improve their wellbeing.

So, the federal government will put “full employment” at the heart of Australia’s policy frameworks and institutions, to drive down structural unemployment over time and keep unemployment as low as possible. And they say the benefits of a strong labour market are not equally shared.

http://www.martinnorth.com/

Go to the Walk The World Universe at https://walktheworld.com.au/

Digital Finance Analytics (DFA) Blog
Digital Finance Analytics (DFA) Blog
More “Announcables” To Look Good And Do Little!
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More “Announcables” To Look Good And Do Little!

I have discussed before the spate of announcables from the current Government – events and releases which give the impression of taking bold actions which grab headlines, but which in reality signifies very little at all. Housing was a standout example, but now we have another, the jobs plan.

Which in fact was a scene resembling The Hollowmen. It took 260-pages and six cabinet ministers to announce the jobs plan, and according to Jim Chalmers he wants to reduce the non-inflationary jobless rate so 2.8 million people who are not working, or wanting to work more hours, can bolster the labour market and improve their wellbeing.

So, the federal government will put “full employment” at the heart of Australia’s policy frameworks and institutions, to drive down structural unemployment over time and keep unemployment as low as possible. And they say the benefits of a strong labour market are not equally shared.

http://www.martinnorth.com/

Go to the Walk The World Universe at https://walktheworld.com.au/

“Captain! The Engines Canna Take More!”

Scotty from Star Trek cries, as the Enterprise shakes and hums, as they try to squeeze more out of the warp core. This to me is a good analogy to what’s happening in the economy, based on the latest data from the ABS.

First, Average weekly ordinary time earnings for full-time adults was $1,838 in May 2023, according to new seasonally adjusted figures released today by the Australian Bureau of Statistics (ABS).

The ABS also said the unemployment rate increased by 0.2 percentage points to 3.7 per cent in July (seasonally adjusted).

Now three points, we know that given the pressures on households many are seeking and able to work more hours, and many via multiple jobs to increase income to cover the rapidly rising costs of living – including of course rental payments or increased mortgage payments.

Second, the rise in the unemployment rate is partially explained by the school holidays which occurred through the sample period.

But third, again we have sampling changes as the ABS roll off old samples, and bring a new one in. And here we see the new sample contains significantly higher unemployment counts sufficient to move the dial.

Thus, there is little here to prove that unemployment is rising so implying the RBA won’t hike. Next month we will likely see things moving around, but the gross growth in hours worked in the real issue – how much further can that be pushed, I suspect we are to return to our Star Trek introduction, pushing the Australian economic engines as far as they can go – until something breaks!

http://www.martinnorth.com/

Go to the Walk The World Universe at https://walktheworld.com.au/

Today’s post is brought to you by Ribbon Property Consultants.

Digital Finance Analytics (DFA) Blog
Digital Finance Analytics (DFA) Blog
"Captain! The Engines Canna Take More!"
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“Captain! The Engines Canna Take More!”

Scotty from Star Trek cries, as the Enterprise shakes and hums, as they try to squeeze more out of the warp core. This to me is a good analogy to what’s happening in the economy, based on the latest data from the ABS.

First, Average weekly ordinary time earnings for full-time adults was $1,838 in May 2023, according to new seasonally adjusted figures released today by the Australian Bureau of Statistics (ABS).

The ABS also said the unemployment rate increased by 0.2 percentage points to 3.7 per cent in July (seasonally adjusted).

Now three points, we know that given the pressures on households many are seeking and able to work more hours, and many via multiple jobs to increase income to cover the rapidly rising costs of living – including of course rental payments or increased mortgage payments.

Second, the rise in the unemployment rate is partially explained by the school holidays which occurred through the sample period.

But third, again we have sampling changes as the ABS roll off old samples, and bring a new one in. And here we see the new sample contains significantly higher unemployment counts sufficient to move the dial.

Thus, there is little here to prove that unemployment is rising so implying the RBA won’t hike. Next month we will likely see things moving around, but the gross growth in hours worked in the real issue – how much further can that be pushed, I suspect we are to return to our Star Trek introduction, pushing the Australian economic engines as far as they can go – until something breaks!

http://www.martinnorth.com/

Go to the Walk The World Universe at https://walktheworld.com.au/

Today’s post is brought to you by Ribbon Property Consultants.

If you are buying your home in Sydney’s contentious market, you do not need to stand alone. This is the time you need to have Edwin from Ribbon Property Consultants standing along side you.

Buying property, is both challenging and adversarial. The vendor has a professional on their side.

Emotions run high – price discovery and price transparency are hard to find – then there is the wasted time and financial investment you make.

Edwin understands your needs. So why not engage a licensed professional to stand alongside you. With RPC you know you have: experience, knowledge, and master negotiators, looking after your best interest.

Shoot Ribbon an email on info@ribbonproperty.com.au & use promo code: DFA-WTW/MARTIN to receive your 10% DISCOUNT OFFER.

The Number-Wangers Are At It Again! [Podcast]

Australian employment surpassed expectations in June and the jobless rate held at a lower revised rate, underlining the labor market’s resilience to rapid interest-rate increases.

The jobless rate remained at 3.5%, having hovered in a range of 3.4%-3.7% since June last year, Australian Bureau of Statistics data showed Thursday. The economy added 32,600 roles from a month prior, more than double estimates, and employment has now risen in nine out of the past 12 months.

The data increases pressure on the Reserve Bank to resume raising rates, with money market bets implying a better-than 50% chance of a hike to 4.35% at its Aug. 1 meeting. The Australian dollar extended earlier gains, rising to 68.25 US cents. Three-year bond yields jumped 12 basis points, heading for their largest one-day increase since July 7.

http://www.martinnorth.com/

Go to the Walk The World Universe at https://walktheworld.com.au/

Today’s post is brought to you by Ribbon Property Consultants.

If you are buying your home in Sydney’s contentious market, you do not need to stand alone. This is the time you need to have Edwin from Ribbon Property Consultants standing along side you.

Buying property, is both challenging and adversarial. The vendor has a professional on their side.

Emotions run high – price discovery and price transparency are hard to find – then there is the wasted time and financial investment you make.

Edwin understands your needs. So why not engage a licensed professional to stand alongside you. With RPC you know you have: experience, knowledge, and master negotiators, looking after your best interest.

Shoot Ribbon an email on info@ribbonproperty.com.au & use promo code: DFA-WTW/MARTIN to receive your 10% DISCOUNT OFFER.

Digital Finance Analytics (DFA) Blog
Digital Finance Analytics (DFA) Blog
The Number-Wangers Are At It Again! [Podcast]
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The Number-Wangers Are At It Again!

Australian employment surpassed expectations in June and the jobless rate held at a lower revised rate, underlining the labor market’s resilience to rapid interest-rate increases.

The jobless rate remained at 3.5%, having hovered in a range of 3.4%-3.7% since June last year, Australian Bureau of Statistics data showed Thursday. The economy added 32,600 roles from a month prior, more than double estimates, and employment has now risen in nine out of the past 12 months.

The data increases pressure on the Reserve Bank to resume raising rates, with money market bets implying a better-than 50% chance of a hike to 4.35% at its Aug. 1 meeting. The Australian dollar extended earlier gains, rising to 68.25 US cents. Three-year bond yields jumped 12 basis points, heading for their largest one-day increase since July 7.

http://www.martinnorth.com/

Go to the Walk The World Universe at https://walktheworld.com.au/

Today’s post is brought to you by Ribbon Property Consultants.

If you are buying your home in Sydney’s contentious market, you do not need to stand alone. This is the time you need to have Edwin from Ribbon Property Consultants standing along side you.

Buying property, is both challenging and adversarial. The vendor has a professional on their side.

Emotions run high – price discovery and price transparency are hard to find – then there is the wasted time and financial investment you make.

Edwin understands your needs. So why not engage a licensed professional to stand alongside you. With RPC you know you have: experience, knowledge, and master negotiators, looking after your best interest.

Shoot Ribbon an email on info@ribbonproperty.com.au & use promo code: DFA-WTW/MARTIN to receive your 10% DISCOUNT OFFER.