Australia’s unemployment rate has fallen 0.1% to a 12-month low of 6% in May, as 42,000 more jobs were created in our economy.
According to the jobs data released by the Australian Bureau of Statistics, the participation rate also held steady at 64.7% and hours worked rose by 0.1% in May to record highs. Hours worked are now up 2% over the year.
Savanth Sebastian, economist for CommSec says the May data has exceeded expectations and suggests that the unemployment rate has finally topped out.
“[There was] a solid lift in both full-time and part-time employment; a slide in the unemployment rate; and a steady participation rate. Employment surpassed even our rather optimistic expectations,” he said.
“If there was any dampener to the result it was the mild downward revisions to last month’s employment results.
“Over the past seven months almost 200,000 jobs have been created. Jobs are being created, more hours are being worked by existing workers, and more people are finding work. The unemployment rate looks like it has topped out.”
While each Reserve Bank meeting will be a “live” on, the positive jobs data means that the central bank can feel more comfortable about sitting on the sidelines and letting the economy evolve in the low inflation environment. The lower currency and ongoing strength in home building will support activity levels.