The Australian economy has recorded its seventeenth consecutive month of employment gains. The run of monthly consecutive gains has exceeded the fourteen month stretch from August 1979 to September 1980 and the fifteen months stretch from May 1993 to July 1994.
The ABS has released employment estimates for February which indicate the total number of people employed in Australia in either full-time or part-time work increased by 17,500. Market expectations prior to the report’s release were for 20,000 new positions to be created.
Westpac economist Simon Murray said, “February’s jobs gain of 17,500 is consistent with a solid employment growth outlook over the near-term as suggested by business surveys. Momentum has eased from 2017’s well-above-average performance…Though that pace is still faster than working age population growth of around 1.7% annually, the recent experience has shown higher employment growth being met with rising participation.”
Financial markets reacted by sending yields and the local currency lower. Local 3-year and 10-year bond yields had started the day higher despite lower U.S. yields but they dropped upon release of the employment figures and then drifted up for the rest of the day. 3-year bond yields finished 4bps higher at 2.22% while 10-year bond yields remained unchanged at 2.72%. The AUD also initially fell around 0.15 U.S. cents and then settled at about 77.50 U.S. cents.
The participation rate increased from 65.6% in January to a near-record 65.7% as an additional 26,400 people entered the labour market. While total employment increased, the total number of unemployed increased by 8,900 and the unemployment rate ticked up from 5.5% to 5.6%.
The aggregate number of work hours across the whole Australian economy increased as full-time positions increased at the expense of part-time positions. The total number of work hours across the whole economy increased by 1.2% when compared to January’s figure. On a 12 month basis aggregate hours worked jumped by 3.9% as 327,600 full-time and 93,100 part-time positions were created (after revisions).