Yesterday’s labour force data from the Australian Bureau of Statistics won’t make the current state of the economy’s health any clearer. They were confusing.
The bottom line from the report is a lack of clarity, so don’t believe anyone who says this adds to pressures for a rate cut, as some reports yesterday claimed.
Remember, the RBA cut rates twice in the December quarter when, as we found out this week, growth had slowed to 0.4% from 0.8% in the September quarter.
While January’s jobs data had been emphatically strong in showing a 46,300 rise in new jobs, and a dip in the unemployment rate to 5.1% from 5.2% in December, the February figures were weak, showing a rise in the jobless rate to 5.2% (so in reality, no change from what was reported for December of last year) and a drop in employment of 15,400, all part-timers.
The ABS said the "decrease in employment was driven by decreased part-time employment, down 15,400 people to 3,380,400, while full-time employment remained at 8,063,600… The decrease in seasonally adjusted part-time employment was driven by a decrease in female part-time employment."
A fall in female part-time employment was the major reason for the fall in employment in December, when fewer-than-expected pre-Christmas jobs in retail opened up for women, especially in the 15 to 24 age bracket.
Seasonally adjusted, the number of people unemployed increased by 16,400 people to 632,200, unlike January when there had been a fall of 15,300.
The labour force participation rate dropped 0.1 percentage points to 65.2%.
There were mixed results among the states.
NSW maintained January’s strong performance and stayed level at 5.2% seasonally adjusted, with no change in the participation rate .
But unemployment in Victoria rose 0.2% to 5.4% and February was therefore the first time since 2006 that unemployment has been higher in Victoria than NSW.
Unemployment also rose 0.3% in Queensland, off the back of a big fall in participation, 0.4%. It went up in South Australia 0.1% to 5.2%, off another fall in participation, but unemployment fell in WA, down 0.1% to 4.0% as the resources boom continues to drive activity in that state.
But complicating the report was a sharp rise in hours worked last month.
The ABS said the monthly aggregate hours worked series showed an increase in February, up 21.6 million hours to 1,616.6 million hours, compared to January when they fell 23.1 million.
The trend data, which is supposed to smooth out the month to month jumps in seasonally adjusted estimates, proved little help for February and if anything added to the uncertainty.
It showed no change in the jobless rate of 5.2%, a rise of just 1,100 in the number of people employed and a fall of 1,700 people unemployed. So more confusion.
Coming on top of the weaker than expected GDP data on Wednesday, the economy is clearly sluggish in places, with jobs growth barely keeping pace with population and work force growth.
But it is not going backwards.
And industrial disputes data yesterday showed that days lost to industrial disputes in the December quarter nearly halved from the September quarter, from 101,000 to 54,000.
The rise in industrial disputes has been repeatedly cited as an example of the inflexibility of the Fair Work Act, by mainstream media.
It’s not as simple as that, just as the improvement in productivity is more complex than media and business suggests.
That small, but significant improvement in productivity in the December quarter we told you about yesterday, was ignored today in mainstream media reports.
The resources boom delivered Australia a record $190 billion in resource export revenues in calendar 2011, according to figures released by the federal government yesterday.
Energy and resources export earnings jumped 15% in 2011, from $166 billion in 2010, the Bureau of Resources and Energy Economics (BREE) said.
Shipments of coal, iron ore and liquefied natural gas drove most of the growth, thanks to strong Asian demand underpinned by China.
Iron ore was the nation’s most lucrative export, worth $59.3 billion, followed by coal (coking and thermal) which earned $46.9 billion.
The surge in export revenue came despite a 2% fall in earnings during the December quarter (which drive the 4.7% fall in our terms of trade as revealed in Wednesday’s national accounts) and the widespread disruption to the coal industry from the floods of early 2011 (which lingered through the year).
The Bureau’s chief economist Quentin Grafton said prices and expansion of capacity by iron ore miners helped offset the weakness in coal production.
"Increased iron ore production was underpinned by the start up of new capacity in the Pilbara region of Western Australia, while coal production was affected by flooding in Queensland in early 2011," Professor Grafton said in yesterday’s statement.
The index of unit returns of Australian exports for mineral resources increased by 14% in 2011, compared with 2010.
Export prices for metals and other minerals rose 9%, while export unit returns for energy commodities increased by 20% as prices for oil and LNG rose on world markets (especially in the Japanese market for LNG).
The increase in export values for resources and energy commodities was moderated by the appreciation of the Australian dollar which averaged US$1.03 in 2011, 12% higher than in 2010.
BREE said commodities that recorded significant increases in export earnings in 2011, relative to 2010 inc
