In something of an embarrassing turn of events for the ABS the bureau have today released the labour force data for Sept with some major revisions (and a lengthy explanatory note) which sees the seasonal adjustment removed from the Jul, Aug and Sept data (for reasons that the ABS cannot fully explain). As we commented upon last month (see here) the data in both Jul and Aug were odd in the extreme. It now appears that there was indeed something strange going on and the ABS have therefore made some major adjustments to try and correct for the “errors”. All of which means that comparisons to previous months become something of a moot point, so we will simply look at the data as it now stands.
Employment in Sept fell by 29,700 after increases of 32,100 and 11,900 in Aug and Jul. In Sept full time jobs were up 21,600 after falling 79,700 in Aug. The headline unemployment rate rose to 6.1% (from 6.0% in Jul and Aug) with the Participation Rate falling to 64.5 (down from 64.7), PR is now at its lowest level since Jan 2006. The employment to working population now sits at 60.6 (its lowest level since Dec 2004). What all this means is that the seasonally adjusted series is suggesting that the Aussie labour market is in a much weaker position that previously thought.
However, for those who will have lost all faith in the seasonally adjusted data (not unreasonably!) the Trend data is also weaker. Trend employment in Sept was up 5,600 after increases of 7,400 and 8,700 in Aug and Jul. The Trend unemployment rate has ticked higher to 6.1% (from 6.0%) while Trend PR stays stuck at 64.6.
Queensland sees some major changes for Sept which, at least on the face of it, suggest a rather better picture. However, in fact that is not the case. The headline seasonally adjusted data shows the unemployment rate at 6.3% (down from 6.4% in Aug which was itself revised down from 6.7%). However, the previously reported increase of 26,500 jobs in QLD in Aug has been revised to just 4,900 and the state has shed 17,200 jobs in Sept. Full time jobs in QLD fell sharply in Aug (down 26,500) and have fallen again in Sept (down 1,700). Full time jobs are now down 12,000 since the start of the year. The biggest concern within the QLD data is the huge (and very dramatic) downward revisions to the Participation Rate data. PR in Sept fell to just 65.5 (down from 66.2 in Aug which was itself revised down from 66.8), This takes PR in QLD to levels seen at the start of this year and wipes out the recovery we had been witnessing throughout 2014.
The Trend data for QLD also shows deterioration. Trend employment fell by 2,900 (after Aug and July were revised down by a combined 7,800). The Trend unemployment rate has increased to 6.4% (from 6.3%) and Trend PR has fallen to 65.9 (from 66.0).
Any jobs recovery which QLD had been enjoying this year would appear to have been comprehensively wiped out by today’s data.
The confusion around the ABS data will do nothing for people’s confidence in the labour force statistics but, as always, we would emphasise that focus should be on the Trend data. Our own Conus Trend series for the QLD regions will be released next Thursday.
UPDATE. Gene Tunny at Queensland Economy Watch makes some interesting observations about the issues facing the ABS and the impact on the credibility of their data.