Australia's labour market expected to soften as unemployment rises

Summarised from 2 outlets · 3 reports · Updated 11 Oct, 02:24 · Archive

Australia's unemployment rate reached 4.6 per cent in August, the highest since November 2021, as the Reserve Bank assesses the impact of interest rate rises.

Australia's labour market is expected to continue softening despite small businesses retaining staff amid cost pressures. Unemployment reached 4.6 per cent in August, the highest level since November 2021 and above the Reserve Bank's forecast of 4.5 per cent for the December quarter. Economists will scrutinise unemployment data and the Reserve Bank's September meeting minutes, released on Tuesday, to understand how interest rate hikes are affecting the economy.

The Reserve Bank raised the cash rate to 4.6 per cent in September with all nine board members voting unanimously in favour. Reserve Bank governor Michele Bullock said she still believed the labour market was a little tight following the September decision, though the jobless rate has risen faster than the central bank forecast.

However, the labour market is sending mixed signals. While unemployment has been rising, this is largely because more people are looking for work, with the participation rate hitting an almost-record-high of 67.1 per cent in August. On some measures such as job growth figures and job ads, demand for labour has remained solid, but other signs point to a weakening of business hiring intentions.

How it is being reported

• Economists to pore over jobs data, Reserve Bank minutesAustralia's labour market is expected to continue to soften, even though small businesses are hanging on to workers despite growing cost pressures.Perth Now · 11 Oct, 02:02
• Economists to pore over jobs data, Reserve Bank minutesAustralia's labour market is expected to continue to soften, even though small businesses are hanging on to workers despite growing cost pressures.The West Australian · 11 Oct, 02:02
• Economists to pore over jobs data, Reserve Bank minutesAustralia's labour market is expected to continue to soften, even though small businesses are hanging on to workers despite growing cost pressures.The West Australian · 11 Oct, 02:02

In this story: Reserve Bank · Michele Bullock · Australia · Westpac

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