The headline figure is that the employment market pretty much marked time last month, but underneath that is a story of labour market strength that has become undeniable – the good news within the Australian economy.
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The unemployment rate is steady and labour market strength has become undeniable. Michael Pascoe comments.
After employment growth that seemed just too good to be true in October and November, the Australian Bureau of Statistics seasonally adjusted count for December was a fall of 1,000 jobs – with 11,902,300 jobs, 1,000 doesn't rate. Call it a steady result.
On the trend series reckoning, the ABS scored employment growth of 27,500. On both counts, the unemployment rate stayed steady on 5.8 per cent.
The result was better than nearly everyone predicted. Maybe now the commentariat will have to simply accept that more is happening primarily in the service sector of the economy that it has been willing to accept.
And while there was a seasonally adjusted dip in New South Wales employment, the most populous state continues to lead the way with a steady unemployment rate of 5.2 per cent. It is the only state below the national average, followed by Queensland improving to 5.8 per cent and Victoria on 5.9.
The Bloomberg survey of 23 economists had a median prediction of 10,000 fewer jobs and the unemployment rate rising a notch to 5.9 per cent. That median guess reflects doubt about the veracity of the two previous months' figures.
NAB analysis of the extremely strong. October and November jobs growth put it down to how the ABS survey is done, claiming all the growth came from "sample rotation".
The NAB team therefore predicted the sample rotation factor would ease out, resulting in a fall in employment of 25,000, making the NAB's one of the more pessimistic forecasts among 23 economists polled by Bloomberg. It looks like it's back to rotating the sample rotation data for NAB.
But the NAB's wasn't the most pessimistic forecast – Societe General guessed 45,000 fewer jobs. The most optimistic view was TD Securities with 15,000 extra jobs.
Doubts about labour market strength have been flying in the face of other indicators that back the optimism, such as this week's strong job vacancies figures.
According to that ABS survey, it's the best time in three years to be looking for a job. It's New South Wales were the most vacancies can be found. NSW's quiet boom in infrastructure investment, Sydney construction and tourism continues to pay off in employment.
And there was better news within that steady national December job count. The jobs that were lost were part-time. Full-time employment increased by a healthy 17,500.