Today’s labour force data from the ABS for July is a shocker. Jobs, which had been expected to rise by about 12,000, actually fell 300 (and June’s increase was revised lower to +14.9). The headline seasonally adjusted unemployment rate jumped to 6.4% (from 6.0% in June); the increase slightly mitigated by the fact that the Participation Rate increased to 64.8 (from 64.7). However, it is worth noting that full-time jobs were actually up strongly (+14,500) and so far this year are up 110,000; which is more than total jobs created for the year. We are seeing a significant shift from part-time to full-time jobs nationwide.
Queensland’s data is even less inspiring. Total jobs fell by 12,600 in July (with June’s small increase revised down to just +1,700). Unlike at the national level, Queensland full-time jobs accounted for almost all the decline (down 12,000) this month and have now fallen by 2,300 this year while total jobs are up 24,200. In the Sunshine State jobs creation has all been part-time. The headline unemployment rate in QLD came in at 6.8% (up from 6.3% in June) and this is made all the more disappointing by a fall in the Participation Rate to 66.2.
The scale of the surprise in the seasonally adjusted data is already making some commentators suggest that we should be looking at the ABS Trend data instead. Doing so paints a less dramatic, but still weak, picture. Trend employment growth nationally was its lowest in 9 months (+4,600) while the Trend unemployment rate remains stuck at 6.1%, up from 5.7% a year ago. The Trend data for QLD shows employment up 1,300 (its slowest rate of growth in 8 months) and the Trend unemployment rate increased to 6.5% from 5.9% a year ago.
The weakness of this data has reignited the possibility of further rate cuts from the RBA and, as a result, seen the A$ fall sharply against the US$. The Aussie fell about half a cent on the release and is now trading just below US$0.93.