CCH Australia – 12 July 2002

The recovery in full-time employment has petered out faster than expected, although the outlook for employment remains positive, according to Justin Smirk, economist at Westpac Bank.

According to the Australian Bureau of Statistics, the seasonally adjusted unemployment rate rose to 6.5% in June 2002 from 6.3% in the previous month. Even though employment rose by 12,600 to a record high of 9,317,800 in June 2002 in seasonally adjusted terms, the participation rate rose by 0.1% to 63.7%, increasing the unemployment rate. Part-time employment grew by 80,500 while full-time employment fell by 67,800.

Smirk said the figures indicate that demand for labour is not as strong as indicated by the 1.9% annual growth in employment, and suggests that construction is no longer adding to employment growth.

Tony Abbott, Minister for Employment and Workplace Relations, said the figure reflects the typical volatility of the monthly labour force series, and that some correction in full-time employment might have been expected after the very strong growth recorded in May. He said that overall, the June figures do nothing to detract from the view that solid employment growth will continue over the coming months.