Australia: August employment strong on all levels - ING

Rob Carnell, Chief Economist at ING explains that Australia’s full time employment delivers most of the gains while he unemployment rate stays at 5.6% despite rising participation rate.

Key Quotes

“Even our outlying forecast of +40,000 employment growth in Australia, under-predicted the actual outcome of +54,200 and we also had not anticipated such a strong contribution from full time jobs. These grew by 40,100, more than reversing the 19,900 decline the previous month.”

“With only 14,100 part-time jobs adding to the total, this is a much higher quality labour report than we had been expecting. And it is further enhanced by the unemployment rate, which stayed at 5.6% despite a rise in the participation rate to 65.3% from 65.1%. What this shows is that even new entrants to the labour force are finding it easy to obtain work.”

“All of which should garner thoughts that the RBA may not be on hold quite as long as markets had been thinking - which may also be influenced by rising anticipation of a December Fed rate hike and should give the AUD a further lift in the short term.”