The unemployment rate in Australia fell from 3.5% in June to 3.4% in July, a new historic low since August 1974, according to the Australian Bureau of Statistics (ABS).
At the same time, however, a decline in employment was recorded during that period, as an estimated 40,900 jobs were «lost.».
So how did unemployment decline? The number of unemployed fell by 20,000, but there was also a decline in labor force participation, from a historic high of 66.8% to 66.4%. In other words, fewer people were working or looking for work last month compared to June.
«This is the first decline in employment since October 2021, following the easing of restrictions and lockdowns at that time after the ‘Delta’ surge,» said Bjorn Jarvis, head of Employment Statistics at the ABS.
Working hours also fell by 0.8% due to school breaks, as well as illnesses—with COVID-19 and the flu «sweeping» across Australia.
«In addition to those who take leave … there were about 750,000 who worked fewer hours in July 2022 because they were sick—nearly twice as many as usual in the middle of winter,» Mr. Jarvis commented.
«Given the sheer number of cases … some people who were on leave … may also have been sick or caring for others.».
The data, however, indicate that the labor market remains «strong,» although it is particularly «tight.».
«The decline in unemployment in July reflects an increasingly ‘tight’ labor market, with a high number of job openings and ongoing staff shortages, which has brought the unemployment rate down to its lowest level since August 1974,» he explained.
«In July,» he added, “there were fewer unemployed people (474,000) than there were job openings (480,000 in May).”.
More specifically, the unemployment rate for men fell by 0.2% to 3.4% and remained stable for women at 3.4%.
Participation did decline to 66.4% (down 0.4% for men and 0.3% for women), but it remains 0.5% higher than before the pandemic.
Employment among young people (ages 15–24) continued to rise in July (+13,000 people, or 0.7%).
The underemployment rate fell by 0.1% to 6%.
The underutilization rate, which combines unemployment and underemployment—and serves as an important measure of «tightness» in the labor market—fell further, by 0.2% to 9.4%, the lowest level since April 1982.
The number of unemployed fell from 493,900 in June to 473,600 in July (by 20,200 people, or 4.1%). Compared to the same month last year, the number fell by 167,600, or 26.1%.
The unemployment rate of 3.4% is 1.9% lower than it was in March 2020, before the pandemic.
Compared to the previous month, unemployment in Victoria fell by 0.1% to 3.1% (the lowest in the entire country); in New South Wales, it remained steady at 3.3%; in Queensland it fell by 0.2% to 3.8%, in South Australia by 0.3% to 4%, in Western Australia by 0.21 TP3T to 3.21 TP3T, in Tasmania by 0.61 TP3T to 3.71 TP3T, in the Northern Territory by 0.2% to 3.5%, while in the Australian Capital Territory it increased by 0.2% to 3.3%.
