The national rate of unemployment fell 0.2% to a final figure of 5.5% for the month of May, exceeding market expectations of the rate remaining steady through the month.
The rate of job creation for the month of May also exceeded expectations, with the 42,200-strong rise in full-time jobs far outstripping the predicted 10,000 rise. In seasonally-adjusted terms, real full-time job creation was up 52,000 jobs with part-time employment falling by 10,000.
This 5.5% unemployment rate is the lowest national rate since February 2013 and, alongside a total of 124,000 full-time jobs created since September 2016, shows significant recovery in the Australian economy after hitting a recent peak in unemployment as recently as March this year. This trend was mirrored in Europe, as statistics for the first quarter of this year showed record employment.
A minimal number of new jobseekers entering the market supports the organic success of these figures, which Capital Economics’ Paul Dales says will hopefully cull concerns that the Reserve Bank of Australia is toying with raising interest rates later in the year.
“The much-stronger-than-anticipated rise in employment in May and the larger-than-expected fall in the unemployment rate will go some way to quashing growing talk of the chance of another interest rate cut by the RBA later this year,” he said.
“Nonetheless, there still appears to be plenty of spare capacity in the labour market, which will keep wage growth weak and mean that the RBA probably won’t raise rates until 2019 either.”
These positive results have also led to a 0.6% spike in the Australian dollar to a seven-week high of 76.15 US cents.
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