What's happening to unemployment in Australia?

Australia’s unemployment rate held steady at 4.1% in September, unchanged from the revised figure for August, according to seasonally adjusted data released by the Australian Bureau of Statistics (ABS).

Employment increased by 64,000 people during the month, while the number of unemployed fell by 9,000, maintaining the unemployment rate at slightly above 4%, where it has remained for the past six months, ABS head of labour statistics Bjorn Jarvis (pictured) said.

A rise in employment also pushed the participation rate to a record high of 67.2%, up 0.1 percentage point from August.

“Employment has grown by 3.1% over the past year, outpacing the civilian population growth of 2.5%,” Jarvis reported. “This has led to an increase in the employment-to-population ratio, which reached a new high of 64.4%.”

Job vacancies remain above pre-pandemic levels, supporting labour force growth across various industries. Despite the number of unemployed falling slightly to 616,000 in September, the total number of unemployed people has risen by 90,000 over the past year. However, this is still 93,000 fewer than the pre-pandemic level in March 2020, when the unemployment rate stood at 5.2%.

The latest ABS labour force figures also showed a 0.3% increase in seasonally adjusted hours worked, slightly trailing the 0.4% growth in employment. Male hours worked rose 0.7%, while female hours worked fell 0.3%. Male employment also grew by 0.6%, compared with a 0.3% rise for females.

The underemployment rate, which measures people employed but seeking more hours, fell by 0.1 percentage point to 6.3%. This was down from 6.4% a year earlier and significantly lower than the 8.7% recorded in March 2020.

The combined underutilisation rate, which includes both unemployment and underemployment, fell to 10.4%, well below the 13.9% recorded at the start of the pandemic.

In trend terms, the unemployment rate remained at 4.1% for the fourth consecutive month. Trend employment grew by 44,000 people (0.3%), exceeding the pre-pandemic average growth rate of 0.2% over the past 20 years. Hours worked increased by 0.2%, slightly slower than employment growth.

The employment-to-population ratio held at its record high of 64.4%, while the participation rate reached a new peak of 67.2%. The trend underemployment rate was stable at 6.4%, keeping the overall underutilisation rate at 10.5%.

“The labour market remains relatively tight, with record-high employment and participation measures, and low unemployment and underemployment compared with pre-pandemic levels,” Jarvis noted.

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