How strong is the labour market? Next week sees a further update on the data for full-time and part-time employment, unemployment, underemployment and workforce participation. Each of these sub-sets of the labour force data provides arguably the most important news on just how strong the economy really is. The RBA never adjusts interest rates without some reference to the health of labour market conditions.
If the economy is strong, employment gains are heavily skewed to full time work, under and unemployment are falling and the participation rate is generally on the rise. Over recent months, the general trend in the labour force data has been to the soft side – part-time employment is stronger than full-time and the unemployment rate is on the rise.
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