The moves in the employment market led to a rise in Australian unemployment with 1.23 million Australians (8.5% of the workforce) unemployed in February, up 26,000 on January. The increased unemployment was driven entirely by an increase in part-time unemployment (up 26,000) as summer jobs came to an end while full-time unemployment was virtually unchanged.
In better news there was a significant drop in Australian under-employment with 1.13 million Australians (7.8% of the workforce) now under-employed, down 96,000 (down 0.6% points) on January.
- Workforce dropped 137,000 in February as the Omicron variant continued to disrupt the workforce:
The workforce in February was 14,443,000 (down 137,000 from January – a second straight monthly decline) – comprised of 13,216,000 employed Australians (down 163,000, also a second straight monthly decline) and 1,227,000 unemployed Australians looking for work (up 26,000);
- Employment was down for a second straight month driven by a fall in part-time employment:
Australian employment fell by 163,000 to 13,216,000 in February driven by a fall in part-time employment, down by 191,000 to 4,423,000. However, full-time employment increased by 28,000 to 8,793,000;
- Unemployment increased slightly in February but is still well down on a year ago:
1,227,000 Australians were unemployed (8.5% of the workforce), an increase of 26,000 from January with more people looking for part-time work (up 27,000 to 764,000). The number of Australians looking for full-time work was virtually unchanged at 463,000.
- Under-employment dropped in February to its lowest for a year:
In addition to the unemployed, 1.13 million Australians (7.8% of the workforce) were under-employed – working part-time but looking for more work, a decrease of 96,000 (down 0.6% points) from January.
In total 2.36 million Australians (16.3% of the workforce) were either unemployed or under-employed in February, a decrease of 70,000 on January and the lowest combined unemployed and under-employed in the Australian labour force since pre-pandemic in November 2019 – 2.23 million (16.1%).
Compared to early March 2020, before the nation-wide lockdown, in February 2022 there were almost 200,000 more Australians either unemployed or under-employed (+0.7% points) even though overall employment (13,216,000) is over 300,000 higher than it was pre-COVID-19 (12,872,000).
Roy Morgan’s unemployment figure of 8.5% for February is over 4% points higher than the ABS estimate for January 2022 of 4.2%. However, the ABS figure for January counts as employed an additional 214,400 Australians who were working zero hours for ‘economic reasons’ or ‘other reasons’ – such as being forced into isolation for being a close contact of a confirmed case. In addition, the ABS notes 449,900 workers worked zero hours due to illness, injury or sick leave in January – nearly five times higher than the average for January from 2016-2021 of 92,880 – a difference of 357,020.
If these 571,400 non-workers are added back the ABS unemployment estimate for January increases to 1,152,000 (8.3% of the workforce) – in line with Roy Morgan’s unemployment estimate of 8.5%. The ABS also claims there are an additional 933,000 Australians (6.7% of the workforce) under-employed for a total of 2.1 million unemployed or under-employed (15.1% of the workforce).
Roy Morgan Unemployment & Under-employment (2019-2022)
Source: Roy Morgan Single Source January 2019 – February 2022. Average monthly interviews 5,000.
Note: Roy Morgan unemployment estimates are actual data while the ABS estimates are seasonally adjusted.
Michele Levine, CEO Roy Morgan, says the impact of the Omicron variant on Australia’s employment markets continued into February with a second straight monthly decline in both the workforce and the total number of employed Australians:
“The latest Roy Morgan employment estimates for February show unemployment up 0.3% points to 8.5% and returning to its level in December 2021. There was better news for under-employment which fell 0.6% points to 7.8%. Overall unemployment and under-employment have now dropped to their lowest since the pandemic began in mid-March 2020 – nearly two years ago.
“Although total unemployment and under-employment is at its lowest since the pandemic began the lingering impact of the Omicron variant continued to disrupt the Australian employment market in February. Overall employment fell 163,000 to 13,216,000, a second straight monthly decline.
“The good news is that the high number of cases associated with the Omicron variant are now behind us, except for Western Australia which just re-opened its borders, and we have moved onto other pressing worries. During February mask wearing mandates and restrictions on movement around the country and internationally have now been relaxed as we finally enter a period of ‘COVID-normal’.
“However, the dissipation of COVID-19 doesn’t mean we are able to return to calmer economic times just yet. There were big challenges that emerged towards the end of February with devastating flooding in Queensland and New South Wales leaving tens of thousands of Australians homeless and on the international stage Russia’s invasion of Ukraine is causing huge disruption to global markets.
“Although the direct impact of the conflict on Australia is likely to be small, the sanctions imposed on Russia and its energy exports are set to increase inflation worldwide and lead to a surge in demand for key Australian export goods – particularly gas and coal but potentially other metals as well.
“The increases in the price of oil seen since Russia’s invasion of Ukraine is set to have the biggest immediate impact on the Australian economy. The increasing price of oil will likely see petrol prices in Australia exceed $2 per litre for the first time ever in the next few weeks.
“This presents a huge problem for the Federal Government as it seeks re-election in mid-May. Soaring petrol prices will feed into higher inflation – the latest Roy Morgan figures show Inflation Expectations at 4.9% in January – an equal seven year high. High and rising inflation increases the pressure on the RBA to raise interest rates earlier than forecast and will clearly cause a slowdown in economic growth which will in turn have a negative impact on Australia’s recovering employment markets.”
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