Australia’s unemployment and employment seem to have rebounded in October

Australia’s unemployment and employment levels are expected to have rebounded in October. The most recent three monthly labor market reports were odd, showing declining unemployment and participation rates. According to a Societe Generale research report, the October report is likely to indicate a partial normalization in jobs growth, which is expected to have increased by 25k. Participation rates are also expected to have rebounded along with unemployment.

The labor market data has been quite subdued for most of 2016. Initially, certain weakness seemed to be related to exceptional strength in late 2015; however, this argument looks less and less convincing, noted Societe Generale.

Furthermore, it is not that the overall employment growth has been subdued. It is worrisome that the fulltime jobs have dropped by 112k over the course of 2016, and that all the new job creation has been part-time, which has increased by 163k.

However, with it being a small sample and survey-based report, significant multimonth volatility is unavoidable, said Societe Generale. During September survey, an unusually large deviation in part of the new rotation sample was seen, and it has resulted in an increased uncertainty.