Australian labour market – continues to languish

The latest labour force data released today by the Australian Bureau of Statistics – Labour Force data – for April 2016 show that those ominous signs that have been apparent for most of this year are still hovering above the labour market. Total employment growth was virtually non-existent with only 10,800 (net) jobs created. Full-time employment decreased 9,300, while part-time employment increased by 20,200. It is the second consecutive month of negative full-time employment growth, which highlights the deteriorating labour market situation in Australia. There was also a decline in hours worked which is now trending downwards. Over the last six months, around 87 per cent of the net jobs created have been part-time. The growth in part-time work suggests that overall the quality of work in Australia again deteriorated. So overall a poor outcome. Unemployment rose marginally this month but this is largely because the weak employment growth is interacting with even weaker labour force growth. The participation rate fell again. The teenage labour market remains in a poor state and requires urgent policy intervention. Overall, with weak private investment now on-going, the Australian labour market is looking very weak and the Federal government should have introduced a rather sizeable fiscal stimulus in its recent fiscal statement. This should have included a large-scale public sector job creation program which would ensure teenagers regained the jobs that have been lost due to the fiscal drag over the last several years. However, the Federal government appears incapable of addressing this dire issue. It is embroiled in mythical discussions about running out of money and not being able to defend the economy if there is another crisis. All make believe, while the real world does head towards another major rift. It is up to the Opposition to shift the political agenda (in the current election campaign). But, they are missing in action on these important issues.

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Solving Our Unemployment Crisis presentation, April 19, 2016

Today, I am in Madrid for the start of the public events associated with the promotion of the Spanish version of my current book – Eurozone Dystopia: Groupthink and Denial on a Grand Scale. I travelled this morning from Granada to Madrid and am tied up for the rest of the day. So here is a video of a keynote address I presented on April 19, 2016 to the inaugural Australian Unemployed Workers’ Union Conference Solving Our Unemployment Crisis in Melbourne, Australia. You can find out more about the Union from their – homePage – and their – Facebook Page. They need more members and the support (funding, promotion etc) from all employed people who care about the problem of unemployment. The talk and questions go for about 37 minutes.

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Australian labour market – still weak with a moderate upturn

In the previous two months, there was virtually zero employment growth and labour force participation declined. The latest labour force data released today by the Australian Bureau of Statistics – Labour Force data – for March 2016 show that those ominous signs are still hovering above the labour market. Total employment growth was modest at best – 26,100 (net) jobs created but full-time employment fell by 18,800. There was also a decline in hours worked which is now trending downwards. The growth in part-time work suggests that overall the quality of work in Australia declined in March 2016. So overall a poor outcome. Unemployment fell this month but this is largely because the weak employment growth is interacting with even weaker labour force growth. But still, a decline in unemployment, not induced by a fall in the participation rate is a welcome outcome. The teenage labour market remains in a poor state even though the 15-19 year olds enjoyed part-time employment growth. Overall, with private investment forecast to decline further over the next 12 months, the Australian labour market is looking very weak and the Federal government should be introducing a rather sizeable fiscal stimulus in its upcoming fiscal statement. This should include large-scale public sector job creation which would ensure teenagers regained the jobs that have been lost due to the fiscal drag over the last several years. However, the Federal government appears incapable of addressing this dire issue. It is embroiled in mythical discussions about running out of money and not being able to defend the economy if there is another crisis. All make believe, while the real world does head towards another major rift.

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A return to full employment in Australia will require significantly higher deficits

Last week, the Australian Labor Party (the federal opposition) released a new policy platform, which it hopes will give it some electoral leverage in the upcoming federal election. The Party announced that they would be attacking poverty and inequality by restoring full employment. The UK Guardian political editor opined in her article on Friday (March 18, 2016) – A shift in political thinking is giving Labor a sense of purpose – that the announcement by Labor was a policy breakthrough and a recognition that the neo-liberal claims about free markets etc, that emerged in the 1980s, are no longer a viable basis on which to base policy. I agree. I also agree that a currency-issuing government should always pursue full employment. But the reality is that this pledge from the ALP is going to be as hollow as all the other value statements it makes in an attempt to convince the electorate that it is a progressive party looking out for the workers and the disadvantaged. A lot of jobs have to be created to restore true full employment, which will require significantly larger fiscal deficits. Meanwhile, the ALP is claiming it will return the fiscal balance to surplus.

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Australian labour market – the dismal picture unfolds further

Last month, employment growth was basically flat (slightly negative). Participation decreased. The signs were ominous. This month, the dismal picture unfolded further. Today’s release of the – Labour Force data – for February 2016 by the Australian Bureau of Statistics show that those ominous signs have worsened. Total employment growth was zero (well 300 net jobs). A pathetic result. Unemployment fell but only because the participation rate fell by 0.2 points – thus the idle labour arising from the weak employment growth just left the labour force and is now hidden unemployment. Working hours fell further – the trend is flat and has been for the last few years. The teenage labour market continued to deteriorate with the adjusted unemployment rate (taking into account the sharp fall in participation since the downturn) of 29.1 per cent rather than the official estimate for February 2016 of 17.8 per cent. Overall, with private investment forecast to decline further over the next 12 months, the Australian labour market is looking very weak and the Federal government should be introducing a rather sizeable fiscal stimulus in its upcoming fiscal statement. This should include large-scale public sector job creation which would ensure teenagers regained the jobs that have been lost due to the fiscal drag over the last several years.

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Australian labour market – looking pretty wan indeed

Last month, employment growth was basically flat (slightly negative). Participation decreased. The signs were ominous. Today’s release of the – Labour Force data – for January 2016 by the Australian Bureau of Statistics show that those ominous signs have worsened. Total employment growth fell again with massive drops in full-time jobs, unemployment increased sharply and the unemployment rose by 0.2 per cent on the back of the declining employment and steady participation. The teenage labour market continued to deteriorate with the adjusted unemployment rate (taking into account the sharp fall in participation since the downturn) of 28.2 per cent rather than the official estimate for January 2016 of 18.3 per cent. Overall, with private investment forecast to decline further over the next 12 months, the Australian labour market is looking pretty wan indeed.

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Australian labour market – goes backwards again

Today’s release of the – Labour Force data – for December 2015 by the Australian Bureau of Statistics show a labour market in retreat. Total employment growth was a negative (barely) and labour force participation fell marginally. While total unemployment declined, it was only due to the fact that the labour force shrank by more than employment contracted, which means that actual unemployment was substituted for hidden unemployment. The data continues to strain credibility with some quite bizarre monthly shifts. The cautious position is to look at the trend over the last several months and that suggests that the labour market has improved marginally. However, the teenage labour market remains very weak with no discernible upwards trend revealing itself yet. If the forecasted decline in private investment occurs over the next 12 months, then this modest improvement in the labour market over the last six months will not persist.

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Australian Labour Force – improvement but credibility stretched

Today’s release of the – Labour Force data – for November 2015 by the Australian Bureau of Statistics once again brings into question the validity of drawing assessments about the state of the labour market on the basis of monthly changes in the data. Today’s release shows that employment increased by 71,400 (0.6 per cent) on the back of a similar substantial increase last month. The estimates strain credibility although they are not necessarily at odds with what other data is suggesting. The direction is probably correct – that is, the labour market has improved (the Employment-Population ratio reliably indicates that). The ABS estimated that despite the dramatic increase in employment, unemployment fell by only 2,800 as a result of a 0.3 percentage points surge in the participation rate (again stretching credibility). Perhaps a signal on how volatile the data is, the ABS estimated the teenage participation rate rose by 0.7 percentage points on theh back of a estimated 0.8 point rise in October – again rather fanciful. The cautious position is to look at the trend over the last several months and that suggests that the labour market has improved. However, the teenage labour market remains very week with no discernible upwards trend revealing itself yet. If the forecasted decline in private investment occurs over the next 12 months, then this improvement in the labour market data will not persist.

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Australian labour market – improvement but hardly credible

Today’s release of the – Labour Force data – for October 2015 by the Australian Bureau of Statistics once again brings into question the validity of drawing assessments about the state of the labour market on the basis of monthly changes in the data. Today’s release shows that employment increased by 58,600 (0.5 per cent) which is the largest monthly rise since March 2012 – and quite unbelievable really. The ABS estimated that unemployment fell by 33,400 to 739,500 and the unemployment rate dropped 0.3 percentage points to 5.9 per cent. Perhaps a signal on how volatile the data is, the ABS estimated the teenage participation rate rose by 0.8 percentage points, again rather fanciful. The cautious position is to look at the trend over the last several months and that suggests that the labour market has improved a little (Employment to Population ratio has been steadily rising). However, the teenage labour market remains very week with no discernible upwards trend revealing itself yet. If the forecast ed decline in private investment occurs over the next 12 months, then this slight improvement in the labour market data will be just a little blip in an unfolding nasty story.

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Australian labour market – in retreat on the back of poor macro policy settings

Today’s release of the – Labour Force data – for September 2015 by the Australian Bureau of Statistics shows that the Australian labour market went backwards this month after stalling last month. Employment growth was negative (drop of 5,100 thousand) and the participation rate fell by 0.2 points. The net result was that the labour force fell faster than employment and so unemployment fell by 8,100 thousand. The unemployment rate remained unchanged at 6.2 per cent. This is one of those times when falling unemployment is not a good signal. The unemployment rate would have risen to 6.3 per cent had not the participation declined. The teenage labour market went backwards again in September and their situation remains parlous. We are still waiting to see how much damage the the forecasted decline in private investment will bring. But with a weakening labour market and the Federal government intent on cutting its net spending over the next 12 months, the outlook looks rather depressing.

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