The ABS released the latest employment data for December, and reported a trend estimate of employment increased by 23,100 persons in December 2018, with:
- the number of unemployed persons decreasing by 3,200 persons;
- the unemployment rate remaining steady at 5.0%;
- the participation rate remaining steady at 65.6%; and
- the employment to population ratio remaining steady at 62.3%.
In fact they revised down last months data to get to the 5%, where it remained in December. This will temper any RBA response to the falling housing market in our view.
Graph 1, Employment to population ratio, Persons, December 2008 to December 2018
The monthly trend unemployment rate increased by 0.1 pts in Western Australia (6.4%) and the Northern Territory (5.0%). It remained unchanged in New South Wales (4.3%), Queensland (6.2%), South Australia (5.8%), Tasmania (5.8%) and the Australian Capital Territory (3.6%). It decreased 0.1 pts in Victoria (4.4%).
They say that over the past year, trend employment increased by 284,100 persons (or 2.3%), which was above the average annual growth rate over the past 20 years of 2.0%. Over the same 12 month period the trend employment to population ratio, which is a measure of how employed the population (aged 15 years and over) is, increased by 0.4 percentage points (pts) to 62.3%.
In monthly terms, trend employment increased by 23,100 persons between November and December 2018. This represents an increase of 0.18%, which was above the monthly average growth rate over the past 20 years of 0.16%.
Underpinning these net changes in employment is extensive dynamic change, which occurs each month in the labour market. In recent months there has generally been around 300,000 people entering and leaving employment in the month. There is also further dynamic change in the hours that people work, which results in changes in the full-time and part-time composition of employment.
In net terms, trend full-time employment increased by 11,800 persons between November and December 2018, and part-time employment increased by 11,200 persons. Compared to a year ago, there are 189,900 more persons employed full-time and 94,200 more persons employed part-time. This compositional shift led to an increase in the part-time share of employment over the past 12 months, from 31.5% to 31.6%.
The trend estimate of monthly hours worked in all jobs increased by 1.1 million hours (or 0.1%) in December 2018, to 1,759.9 million hours. Monthly hours worked increased by 1.5% over the past year, which was below the increase in employed persons (2.3%). The average hours worked per employed person was 138.5 hours per month, or around 31.9 hour per week.
The trend unemployment rate remained steady at 5.0% in December 2018. The number of unemployed persons decreased by 3,200 to 670,900 persons. Over the past year, the trend unemployment rate decreased by 0.5%, with the number of unemployed decreasing by 46,900 persons.
The trend participation rate remained steady at 65.6% in December 2018. The female participation rate increased to 60.5% and the male participation rate remained steady at 70.9%.
The labour force includes the total number of employed and unemployed persons. Over the past year, the labour force increased by 237,200 persons (1.8%). This rate of increase was above the rate of increase for the total Civilian Population aged 15 years and over (339,900 persons, or 1.7%).
The trend participation rate for 15-64 year olds, which controls (in part) for the effects of an ageing population remained steady at 78.0%. The gap between male and female participation rates in this age range is less than 10 pts, at 82.8% and 73.3% respectively, continuing the long term convergence of male and female participation.
The trend participation rate for 15-24 year olds (who are often referred to as the “youth” group in the labour market) remained steady at 67.9%. The unemployment rate for this group remained steady at 11.3% in December 2018 and decreased by 1.0 pts over the year.
The trend series smooths the more volatile seasonally adjusted estimates and provide the best measure of the underlying behaviour of the labour market.
SEASONALLY ADJUSTED ESTIMATES
Seasonally adjusted employment increased by 21,600 persons from November to December 2018. The underlying composition of the net change was a decrease of 3,000 persons in full-time employment and an increase of 24,600 persons in part-time employment. Since December 2017, full-time employment increased by 162,000 persons, while part-time employment increased by 106,600 persons.
Seasonally adjusted monthly hours worked in all jobs increased by 1.3 million hours (or 0.1%) in December to 1,758.9 million hours.
The seasonally adjusted employment to population increased by less than 0.1 pts to 62.4% in December 2018, and increased by 0.3 pts from the same time last year.
The seasonally adjusted unemployment rate decreased by 0.1 pts to
5.0% in December 2018. The participation rate decreased by less than
0.1 pts to 65.6%.
STATE AND TERRITORY ESTIMATES
TREND ESTIMATES
In December 2018, increases in trend employment were observed in the
majority of states and territories. The largest increases were in
Victoria (up 12,000 persons), followed by New South Wales (up 6,400
persons) and Queensland (up 6,000 persons). Employment fell in Western
Australia (down 500 persons), Tasmania (down 200 persons) and the
Australian Capital Territory (down 200 persons).
Over the past year, increases in employment were observed in all states
except Tasmania (down 300 persons). Both territories recorded falls in
employment (the Australian Capital Territory down 4,500 persons and the
Northern Territory down 3,200 persons). The largest increases were in
New South Wales (up 114,800 persons), Victoria (up 114,300 persons) and
Queensland (up 35,200 persons). The highest annual employment growth
rates were in Victoria at 3.5%, followed by New South Wales at 2.9% and
Queensland at 1.4%. New South Wales and Victoria were the only states to
have a year-on-year growth rate in trend employment above their 20 year
average.
The monthly trend unemployment rate increased by 0.1 pts in Western
Australia (6.4%) and the Northern Territory (5.0%). It remained
unchanged in New South Wales (4.3%), Queensland (6.2%), South Australia
(5.8%), Tasmania (5.8%) and the Australian Capital Territory (3.6%). It
decreased 0.1 pts in Victoria (4.4%).
The only increase in the trend participation rate was in Victoria (up
0.1 pts to 65.8%). Decreases were observed in Tasmania (down 0.2 pts to
60.2%), Australian Capital Territory (down 0.2 pts to 69.4%) and New
South Wales (down 0.1 pts to 64.8%). The monthly trend participation
rate remained unchanged in all remaining states and territories.
SEASONALLY ADJUSTED ESTIMATES
In seasonally adjusted terms, the largest increase in employment was in
Queensland (up 11,600 persons), followed by Victoria (up 10,500 persons)
and New South Wales (up 3,800 persons). The largest decrease was in
Western Australia (down 15,300 persons).
The seasonally adjusted unemployment rate increased in South Australia
(up 0.6 pts to 5.9%) and Tasmania (up 0.1 pts to 5.9%). The largest
decreases in the unemployment rate were observed in Victoria (down 0.4
pts to 4.2%), Queensland (down 0.2 pts to 6.1%) and Western Australia
(down 0.2 pts to 6.3%).
The largest increases in the seasonally adjusted participation rate were
in South Australia (up 0.4 pts to 62.7%) and Queensland (up 0.1 pts to
66.1%). The seasonally adjusted participation rate decreased in Western
Australia (down 1.0 pts to 68.0%) followed by Tasmania (down 0.4 pts to
60.0%) and Victoria (down 0.2 pts to 65.8%).
