Labour Force data for January is generally poor. Same story for QLD but with some brighter points

The release of the January Labour Force data from the ABS this morning paints a rather weak picture across the nation, although not so much that the RBA will be surprised. Employment (seasonally adjusted) lifted slightly more than expected (+13,500) with only a very small downward revision to the Dec data. However, a lift in participation to 66.1 saw the headline unemployment rate move higher to 5.3% (from 5.1%). The more stable Trend series showed a lift on 20,000 to employment and the unemployment rate stable at 5.2% (although Dec was revised up from 5.1%). The Trend rate of employment growth over the year has slowed very slightly from +2.07% to 2.02%.

In Queensland seasonally adjusted employment increased by 2,800 (after Dec was revised down to a fall of 4,300) and the headline unemployment rate jumped to 6.3% (from 5.7%) on the back of an increase in participation. This kind of volatility in the sesaonally adjusted data at the state level is the reason we focus our attention on the Trend series. Here we see Trend employment up 4,700 (after Dec was revised up to a 4,600 increase) and the Trend unemployment rate fell from 6.2% to 6.1%. The annual Trend rate of employment growth edged higher to +2.29% (from 2.28%). 

One of our favourite labour market measures is the Trend hours worked per capita of working-age population. Here we saw declines at both national and state level which emphasises the generally weaker nature of these set of numbers. Spare capacity in the labour market is not only keeping a lid on further declines in the unemployment rate but also taking any pressure off wage growth (as evidenced by the poor WPI data earlier this week).

Regional data from the ASBS will be released next week at which time we will be updating the Conus/CBC Staff Selection Regional Employment Trend series.

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