Unemployment rate unchanged but 22,000 jobs lost

The unemployment rate has remained steady at 4.9% despite 22,000 full-time jobs being lost in May, according to the latest figures from the Australian Bureau of Statistics.

Seasonally adjusted figures show 7,800 jobs were created overall, but all of them were part-time, offsetting the fall in full-time work.

While the 4.9% figure was not a surprise, economists had expected around 25,000 new jobs to be created. The previous month, 22,100 jobs were lost.

The monthly participation rate also remained steady at 65.6%.

Joe Powell, managing director of job site Seek, says the market is yet to experience the full effects of the mining boom, which will shift numbers significantly.

“With the Government’s plans to invest in the skills of Australia’s workforce, we can expect to see more job opportunities come through in the months and years ahead, but exactly how and when is uncertain,” he says.

Powell says the demand for skilled workers continues in industries such as mining, legal, healthcare and medical, design and architecture, and engineering.

“For the month of May, there was a high demand among jobseekers for positions such as customer service and call centre staff, assistant accountants, assembly and process workers, retail assistants, data entry and word processing,” he says.

“By contrast, the hardest to fill positions are typically highly skilled, including construction lawyers and environmental engineers – whose average job ad salaries are both currently over $111,000 per annum – urban designers and planners.”

In light of the latest ABS jobs data, economists are still pointing to an August interest rate rise.

“The RBA’s biggest concern has been the risks to inflation from a stretched labour market and therefore the outlook for the unemployment rate is critical – their current forecast is sub 4.25% in 2013,” Westpac chief economist Bill Evans says.

“We expect that they will be in the ‘jobs slow patch’ camp so will continue to see the labour market as an inflation threat.”

“Rates will remain on hold in July and the hurdle for the inflation rate, which prints on July 28, is probably 0.8%.”