Unemployment Rate in Australia Increases to 3.7% in July

The Australian Bureau of Statistics (ABS) has revealed that the unemployment rate in Australia rose by 0.2 percentage points to 3.7% in July (seasonally adjusted). This shift was accompanied by a decrease in employment by approximately 15,000 individuals and an increase of 36,000 individuals in the number of unemployed, leading to the elevated unemployment rate.

Bjorn Jarvis, ABS Head of Labour Statistics, noted that the reduction in employment follows a prior average monthly increase of around 42,000 individuals during the first half of the year. Despite this decline, employment still remains around 387,000 individuals higher compared to the same period last year.

Jarvis also highlighted that July encompassed school holidays, which can affect the usual seasonal patterns of employment, and that only April also saw a decrease in employment in 2023, which was likewise influenced by school holidays.

While the number of unemployed people reached 541,000 in July, an increase of 36,000 individuals, this figure remains around 172,000 lower than pre-pandemic levels.

The employment-to-population ratio declined by 0.2 percentage points to 64.3%, and the participation rate decreased by 0.1 percentage point to 66.7%.

Despite these changes, both indicators still surpass pre-pandemic levels and are close to their historical highs in May, Jarvis noted.

Monthly hours worked experienced a 0.2% increase in July 2023, while employment decreased by 0.1%. Some of the rise in hours worked was due to fewer people taking leave during school holidays.

Jarvis emphasized that the strength in hours worked indicates a tight labor market, with hours worked being 5.2% higher than in July 2022, a figure well above the 2.8% annual growth in employment during the same period.

Full-time employment notably increased by 386,000 workers compared to July 2022, while part-time employment only saw an increase of 1,000 individuals.

The underemployment rate remained steady at 6.4% in July, which is approximately 2.4 percentage points lower than before the pandemic. However, the underutilization rate, combining unemployment and underemployment, rose by 0.2 percentage points to 10.1%, a figure 3.9 percentage points lower than March 2020.

In terms of underlying trend data, the trend unemployment rate remains at 3.6%, in line with the updated figure for June. Employment grew by 27,000 (0.2%) and hours worked increased by 0.3% in July.

The ABS anticipates releasing more detailed regional labor market information in the upcoming July 2023 issue of Labour Force, Australia, Detailed, on August 24, 2023. The ABS expressed gratitude to the public for their continued participation in their surveys.