By James Glynn
The Australian job market experienced a significant resurgence in August, with an impressive addition of 64,900 jobs to the economy. This robust growth surpassed market expectations and has tempered speculations that the Reserve Bank of Australia (RBA) will abstain from further interest rate hikes.
In tandem with the increase in job opportunities, participation in the labor market also saw an upward trajectory. As a result, the unemployment rate remained steady at 3.7% in August, according to the Australian Bureau of Statistics.
The revival of employment growth, which included the creation of 62,100 part-time positions, signifies a recovery from a recent sluggish phase that witnessed a rise in unemployment rates from approximately 3.5% earlier this year.
Considering the RBA’s announcement that it will closely scrutinize inflation and jobs data when making decisions about interest rates, the latest figures are expected to bolster the argument for at least one more rate hike before year-end.
The noteworthy surge in job opportunities during August followed a minor decline experienced in July, primarily due to the school holiday period as outlined by the ABS.
Analyzing the past two months, the average monthly employment growth amounted to approximately 32,000 individuals, aligning with the average growth observed over the previous year, as reported by the ABS.
Furthermore, August witnessed a record high participation rate of 67.0%, while monthly hours worked decreased by 0.5% throughout the month.
In terms of underemployment, the rate increased by 0.2 percentage points to 6.6% in August. Although this figure is 0.6 percentage points higher than the same month in 2022, it remains significantly lower than pre-pandemic levels by approximately 2.2 percentage points, according to the ABS.