Once again the timing of the monthly surveys for the labour force report from the Australian Bureau of Statistics has prevented us from getting a clearer picture of the true state of the jobs market.
The December report from the ABS on Thursday was, on the face of it, very sold – 65,000 new jobs and the unemployment rate falling to a new multi-year low of 4.1%.
But the survey was taken at the start of last month – the first two weeks of December, according to the ABS which was before the current omicron wave hit hard.
That’s why the picture of a solid jobs market right now is misleading.
Bjorn Jarvis, head of labour statistics at the ABS, said in commentary with yesterday’s report: “The latest data shows further recovery in employment following the large 366,000 increase in November.
“This provides an indication of the state of the labour market in the first two weeks of December, before the large increase in COVID cases later in the month.
“Recovery in New South Wales and Victoria continued to have a large influence on the national figures, with employment in these two states increasing by 32,000 and 25,000 people between November and December. Their employment was around where it had been in May having fallen 250,000 and 145,000 during the lockdowns.”
Both states are where the omicron wave has hit hardest – as well as Queensland and the ACT – with tens of thousands of people infected or force to isolate which in turn has had knock on effects in a wide range of industries and employment.
The ABS said the increase in employment in December of 65,000 people, around two thirds of whom were men (42,000 men and 23,000 women), coincided with a similarly sized fall in unemployment (62,000 people, a 9.8 per cent fall). As a result, the unemployment rate fell by 0.5 percentage points to 4.2%.
“This is the lowest unemployment rate since August 2008, just before the start of the Global Financial Crisis and Lehman Brothers collapse, when it was 4.0 per cent. This is also close to the lowest unemployment rate in the monthly series – February 2008 – and for a rate below 4.0 we need to look back to the 1970’s when the survey was quarterly,” Mr Jarvis said.
The fall in unemployment followed a similar fall in November (69,000 people), and a 0.6 percentage point fall in the unemployment rate. This coincided with employers reporting increased difficulties in filling a historically high number of job vacancies.
“As a result of the similar sized changes in employment and unemployment, the participation rate remained steady in December, at 66.1 per cent. This was in contrast to what we saw in November, when a large number of people who were attached to a job re-entered the labour force, which drove the participation rate up by 1.4 percentage points,” Mr Jarvis said.
“The participation rate in December continued to be relatively high. It was 0.2 percentage points higher than before the start of the pandemic and only 0.2 percentage points below the historical high in May and June 2021.“
As an accurate assessment of where the jobs market currently stands, the only answer can be ‘haven’t a clue’.