SYDNEY — Australia employment jumped past all expectations in November while the jobless rate stayed at five-decade lows as more people went looking for work, a sign interest rates may have to rise further to cool the red-hot labor market.
Figures from the Australian Bureau of Statistics on Thursday showed net employment surged by 64,000 in November, blowing past forecasts for an increase of just 19,000 and up from a jump of 43,100 in October.
The jobless rate held at 3.4%, though only because the participation rate popped up to match the record peak of 66.8%.
Full-time employment climbed by 34,200, while total job gains for the 12 months to November rose a rollicking 553,700.
The underutilization rate, which combines the unemployment rate with those wanting to work more hours, fell to 9.3%, the lowest since 1982 and 4.7 percentage points below pre-pandemic levels.
The tightness of the labor market is one reason the Reserve Bank of Australia (RBA) has raised interest rates for eight months running, lifting them from a record low of 0.1% to a decade-high of 3.1%.
Markets are pricing in at least two more hikes to 3.60% by the middle of next year, though that is down from a peak above 4.0% just a couple of months ago.
The RBA has said it would like to see the progress made on unemployment maintained as long as wage growth did not spiral higher. Inflation is at a 32-year peak of 7.3% and labor costs have picked up recently as firms bid for scarce workers.
The scale of demand was underlined by ABS data showing 380,000 or 3.2% of all jobs were vacant in the September quarter, double the pre-pandemic level.
The number of people holding multiple jobs also rose to a record 6.5%, up from 5.8% prior to the pandemic.
“Border closures have reduced Australia’s under 35 population, creating recruitment difficulties for industries that typically attract younger candidates,” noted Callam Pickering, an economist at job site Indeed.
“Rising immigration will partly address that next year but the massive population shortcut created by prolonged border closures could take a half decade or more to fully fix.” (Reporting by Wayne Cole; Editing by Jacqueline Wong and Edwina Gibbs)