Unemployment in Australia spiked to its highest in four years in September as the number of jobseekers grew.
The seasonally adjusted unemployment rate jumped 4.5%, the highest since November 2021. The current figure is higher than a revised 4.3% in the prior month, according to Thursday data from the Australian Bureau of Statistics.
There were 34,000 more unemployed people in September. The number of employed people also grew, up 15,000 in the same period, Sean Crick, ABS head of labour statistics, said.
The participation rate climbed to 67% from 66.9%. But the rate is still below the record of 67.2%, Crick said, which was posted at the beginning of the year.
Higher participation, combined with softer hiring, opened up a bit more labour market slack in September, Westpac economist Ryan Wells said.
The employment-to-population ratio remained steady at 64%, the ABS said.
The underemployment rate, which tracks down part-time workers, rose to 5.9% in the same month from 5.7%. The increase indicates that these workers may be seeking more work hours.
We suspect that this can largely be explained by the pull-back in part-time employment growth from its peak of around 6%yr to 2%yr currently, meaning there are relatively fewer part-time workers entering the workforce and seeking extra hours of work, Wells said.
Given the data, which signaled a weaker-than-expected Australian jobs market, analysts' bet of a rate cut in November has become stronger.
With unemployment moving in the other direction, we maintain our view that a rate cut is warranted in November, with a final cut this cycle in Q1 next year, Harry Murphy Cruise, Oxford Economics Australia's head of economic research and global trade, said.
Westpac predicted the interest rate to be trimmed by 25 basis points in November.
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