January labour market report from Australia

  • Employment Change: K expected 10K, prior 28.9 K (bushfires and smoke haze across cities is expected to be a significant negative for the month)
  • Unemployment Rate: 5.2% expected %, prior 5.1% (u/e is key for the RBA outlook and hence the AUD, although the RBA is on hold for a few months to come yet)
  • Full Time Employment Change: K prior was -0.3K
  • Part Time Employment Change: K prior was 29.2K
  • Participation Rate: % expected 66.0%, prior was 66.0%

ASB preview:

  • Over the past two months Australia's employment growth has accelerated, driving the unemployment rate down to 5.1% in December from 5.3% in October. We have the unemployment rate holding at 5.1% on a slight fall in the participation rate.

BNZ/NAB previews:

  • NAB forecasts a tick up in the unemployment rate to 5.2% in January, alongside weaker employment growth of 10k (market: 5.2% and 7.5k).
  • Underlying weakness in activity and a deterioration in leading indicators of employment - such as the NAB survey and SEEK job ads - suggests that the recent improvement should be unwound.
  • The Reserve Bank does not forecast the monthly data, but anticipates unemployment to average 5.2% into Q2 2020.
  • Note that the escalation in bushfires at the start of the year may see hours worked in January fall. The disruption may also have caused some delay in surveying, but that is unlikely to significantly affect the headline unemployment and employment figures.

Summertime in OZ

January labour market report from Australia