On the face of it, October’s jobs report – showing a fall in employment, a rise in unemployment and a jump in the jobless rate to 5.2% (from 4.6%) – looked poor and the initial reaction treated it thus.
But as with a number of key bits of data these days, the real story was in the details and the bottom line is that the adverse data points were really positives in that they happened as NSW and Victoria (and the ACT approached and then met their re-opening targets).
In fact the re-openings confused the data – the last week of September and the first 9 days of October is when the data was collected but that perhaps didn’t full capture the impact of the re-openings brought forward in the case of NSW and hinted at in Victoria and the rapid move by the small ACT market towards normality because of its high vaccination rates. The timing of school holidays was also a factor.
So the picture isn’t as gloomy as painted by a rise in the unemployment rate to 5.2%. the rise in the participation rate increased 0.1% to 64.7%, the fall of 46,000 people in employment to 12,835,200, the 82,000 jump in the number of people unemployed; the easing in the employment to population ratio decreased to 61.3%, the rise in the underemployment rate increased to 9.5% and the small one million drop in the monthly hours worked all.
According to Bjorn Jarvis, head of labour statistics at the Australian Bureau of Statistics, the rise in the number of people unemployed “show that people were preparing to get back to work, and increasingly available and actively looking for work – particularly in New South Wales, Victoria and the Australian Capital Territory.
“It may seem counterintuitive for unemployment to rise as conditions are about to improve. However, this shows how unusual lockdowns are, compared with other economic shocks, in how they limit being able to work and look for work.”
“This follows what we have seen towards the end of other major lockdowns, including the one in Victoria late last year,” Mr Jarvis said.
He pointed out that the survey period… “included school holidays and some early changes to restrictions associated with the Delta lockdowns, particularly in New South Wales, ahead of larger changes from mid-October.
“As we’ve seen throughout the pandemic, the changes in the labour markets with lockdowns continued to have a large influence on the national figures,” Mr Jarvis said.
“There was early recovery in New South Wales, with their participation rate increasing by 0.8 percentage points in October. This was underpinned by increases in both employment (22,000) and unemployment (35,000), with their labour force increasing by around 57,000 people. However, it was still 218,000 people lower than in May.”
“In contrast, while Victoria’s unemployment also increased, by 29,000 people, employment fell by a further 50,000, with their participation rate falling by 0.4 percentage points. The Victorian labour force was 113,000 people lower than in May.”
The national participation rate increased by 0.1 percentage points to 64.7% in October but was 1.6 percentage points below May ahead of the start of the Covid delta lockdowns in NSW, Victoria, the ACT and at times in other states for shorter periods of time.
The relatively large increases in unemployment in BSW, Victoria and the ACT saw large increases in their unemployment rates, rising 0.8 percentage points in NSW (to 5.4%), 0.9 percentage points in Victoria (to 5.6%) and 2.5 percentage points in the ACT (to 6.6%).
But Western Australia’s unemployment rate fell another 0.2 percentage points to 3.9%, its lowest rate since mid-2012 and a signal that the state’s resources sector is booming while thew borders remain closed.