Australia’s jobless rate and participation rate seem to have climbed in Q3

Australia’s recent labor market reports updates have been extremely volatile, particularly as far as the composition between part-and full-time employment is concerned, noted Societe Generale in a research report. Given this scenario, it is quite impossible to project anything. However, following a succession of three weak employment growth reports, a slightly firmer growth of 20,000, equivalent to 2 percent at an annualised rate is expected, said Societe Generale. But this would suggest that on average the total employment remained stagnant over the three months to November.

Employment growth has decelerated sharply, reach just 0.9 percent year-on-year in October and hence quite below the pace of growth in the population of working age that stands at 1.5 percent year-on-year. But the unemployment rate has continued with its downward trend. This is because the participation rate has dropped to 64.4 percent in October from 64.9 percent in July.

Even if it is believed that the scope for a cyclical recovery in the participation rate is quite small due to population ageing which is occurring in Australia, it appears like an undershoot and therefore, all the three measures – unemployment, the jobless rate and the participation rate, are likely to climb, added Societe Generale.