The ABS release of jobs data for November contains an apparent paradox. Jobs rose strongly (up 39,100 seasonally adjusted) and yet the unemployment rate also went up (to 5.7%). As keen readers of this blog will realise the answer lies in the fact that the Participation Rate also increased (to 64.6 from 64.4). Given that all (and more) of the increase in employment came from full-time positions (up 39,300) we would have to characterise this as a strong set of numbers despite the uptick in the headline unemployment rate. The markets had been expecting the unemployment rate to remain stable with an increase in jobs of about 17,500.
However, things are never that simple. The seasonally adjusted data has been showing a good deal of volatility of late and we would much prefer focus to therefore be on the Trend series. This is a position shared by the ABS themselves who say quite simply “The trend data provide the best measure of the underlying behaviour of the labour market”. When we look at that Trend data we see the unemployment rate stable at 5.6% with just 3,100 new jobs added. Jobs growth for the past 4 months has been a rather anemic average of just 3,150 per month which is less than half what it had been in the preceding 4 months. When considered from a Trend perspective the data is actually still quite weak with participation at more than 10 year lows. The Trend data is suggesting a fairly weak labour market with sluggish growth and a low Participation Rate.
When we consider Queensland things get even messier. The headline grabbing seasonally adjusted data suggests employment jumped by 38,600 in November with 25,400 of those new positions being full-time. However, like the nation, the unemployment rate also increased (to 6.0%) as the Participation Rate rebounded strongly after a very weak read last month (to 64.4 from 63.3). The ABS makes particular note of the variability in the Queensland data saying “The relatively large increase in employment in Queensland in November was seen across a number of rotation groups, including the outgoing-incoming rotation group change in November. This points to general sampling variability across the common sample for Queensland, and also follows three months of decreases in employment.” Our take here would be that it is even more important that our focus remains on the Trend series in Queensland.
The Queensland Trend data shows employment actually still falling (down 700). There have now been Trend declines in employment for 11 consecutive months and a total loss of 30,800 Trend jobs in the past 12 months. The Trend unemployment rate has actually dipped to 5.9% as the Trend Participation Rate falls to a low we haven’t seen since May 1994 (63.9). There is really nothing in these numbers that is good for Queensland, despite headlines screaming of almost 40 thousand new jobs. The chart below makes clear the problem as we clearly see employment growth nowhere near strong enough to keep up with even modest population increases.
The regional labour force data will be released next Thursday at which time we will be updating our Conus Trend series for all regions in QLD, NSW and Victoria. Please also note that you can now sign up for daily email updates of all posts so you need never miss another update. Sign up on the right of this page with your email address.