| Unemployment rate falls to 5.5 percent: ABS |
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The number of Australians in work hit a record high last month as the unemployment rate fell for the second month in a row.
Nearly 11 million Austrailans are now employed - the highest number ever - after 35,200 people found new jobs in December, according to the Australian Bureau of Statistics. Economists had been expecting a rise of 10,000 jobs - both part and full time. Australia's unemployment rate was a seasonally adjusted 5.5 percent in December, compared with an downwardly revised 5.6 percent in November, the ABS said today. While the continuing recovery in the job market is good news for the economy, it raises the chances of an interest rate rise next month. "The labour market continues to post stellar gains, reflecting a domestic economy well into recovery mode," said Alex Joiner, economist at ANZ.
"Consistently strong employment numbers, with more on the way if the lead indicators are anything to go by, combined with solid retail sales leading into Christmas must be giving the RBA significant food for thought." The improving labour market is also expected to have a positive impact on consumer sentiment, adding to the case for higher interest rates. "Less fear about losing their jobs will no doubt see a pickup in retail spending and overall economic activity - in effect a self fulfilling prophecy and clearly another reason why the Reserve Bank will gradually remove the monetary stimulus currently in play," said Craig James, CommSec's chief economist. Total employment rose by 35,200 to 10,906 million in December, seasonally adjusted. Full-time employment rose by 7,300 to 7,635 million in the month and part-time employment was up by 27,900 to 3.271 million. The participation rate in December was 65.2 percent, compared with 65.2 percent in November. The median market forecast was for total employment to have risen by 10,000 in December, an unemployment rate of 5.8 percent and a participation rate of 65.3 percent. The Reserve Bank of Australia will hold its first board meeting of the year on February 2.
This article was taken from: http://money.ninemsn.com.au/article.aspx?id=999603 |