Make no mistake, the November Labour Force report from the Australian Bureau of Statistics (ABS) was one of the most solid we have seen for quite a while-more than the September report this year.
Ignore for the moment the seasonally adjusted figures (which showed a 62,000 jump in the number of new jobs in November) and concentrate on the trend figures which are used to try and smooth out the month to month volatility in the seasonally adjusted series.
The ABS said that 22,000 new jobs were created last month – 15,000 full time and 7,000 part time, with the jobless rate steady on 5.4%, the lowest since January 2013 and the third month in a row at this level.
And yet the strength of the jobs market continues to raise two significant questions – why are wages remaining so slow, and why have consumers shut down spending – as we saw yesterday with department store chain Myer revealing a 5% drop in sales in the first two weeks of this month, after a slide in November.
The jobs data was welcomed by the Federal Government (which will incorporate the data in the mid year economic update on Monday,) and no doubt make optimistic claims about wages and spending and forecast a lower budget deficit than in the budget in May.
But the strong growth in new jobs in the past year, the rising participation rate, especially for women, raises more questions about household confidence and spending than anyone has answers.
It is a quandary that puzzles the Reserve Bank and Federal treasury, although you won’t see much evidence of that in Monday’s mid year update.
The ABS said that monthly trend full-time employment increased for the 14th month in a row in November.
"Full-time employment has now increased by around 308,000 persons since November 2016, and makes up the majority of the 371,000 net increase in employment over the period," the Chief Economist for the ABS, Bruce Hockman, said.
Over the past year, trend employment increased by 3.1%, which is well above the average year-on-year growth over the past 20 years of 1.9%
The trend monthly hours worked increased by 3.8 million hours (0.2%), with the annual figure growing faster than the rise in employment at 3.4%.
The labour force participation rate increased to 65.4%, the highest it has been since October 2011. The female labour force participation also increased, to a yet another historical high of 60.1%
The ABS said the quarterly trend underemployment rate fell by 0.2 percentage points to 8.4% over the quarter to November 2017.
“Over the course of 2017 the underemployment rate has fallen from an historical high of 8.7 per cent in February to 8.4 per cent in November, its lowest point in almost two years,“ Mr Hockman said.
The quarterly trend underutilisation rate, which includes both unemployment and underemployment, decreased by 0.3 percentage points to 13.8%.
