Australia’s unemployment rate has fallen to a three-year low after the number of people in work rose a greater than expected 26,200 in July.
The dollar rose strongly to US77.13c, up from 76.72c on Wednesday, in a sign of renewed market confidence in the Australian economy.
But the headline unemployment figure of 5.72% – the lowest in almost three years – masked the growing trend towards part-time working as the economy transitions from the investment-driven mining boom to a service-focused base.
Full-time employment actually fell by 45,400 jobs in July, while the number of part-time jobs was up by 71,600. The participation rate, which refers to the number of people either employed or actively looking for work, was flat at 64.9%.
The data also shows that 72,000 new jobs were created in the first seven months of 2016, compared with more than 150,000 in the same period last year. Full-time job creation has gone into reverse in that time by almost 65,000 compared with jobs growth of almost 90,000 in the same period last year.
Savanth Sebastian, an economist at CommSec, also noted a slowdown in new jobs being advertised earlier this year, adding that the uncertainty caused by the lengthy federal election campaign could have had a dampening effect on hiring.
“The softer results across the labour market mirror other indicators across the economy, including retail sales,” he said. “It’s pretty clear that the sluggish first half of 2016 resulted in employers managing their major cost base (employees) more carefully.
“The hope would be that now the election is out of the way consumers and businesses will go back to spending, investing and hiring – particularly given the ultra-low interest rates on offer and significant improvements in the household budget.”
In Western Australia, where the jobless rate of 6.3% is the second highest in the country behind South Australia, employment minister Michaelia Cash tried to put some positive spin on the growth in part-time jobs. “I’m not going to demonise part-time employment. I’m going to support it and applaud it because it does represent a good choice for so many people.”
Labor’s employment spokesman Brendan O’Connor said almost one in 10 Australians were looking for more work but could not find it.