Unemployment rate drops in August, 111,000 jobs reappear
Australia’s unemployment rate made a surprise drop in August from 7.5 per cent to 6.8 per cent.
Melbourne’s Stage 4 restrictions and uncertainty in New South Wales were expected to cause a further rise in unemployment.
Economists had estimated a slight rise to 7.7 per cent which would mark another 35,000 job losses. They also tipped the jobless rate could hit as high as 10 per cent but instead 111,000 jobs were created.
In fact, as the CommSec noted, this was the biggest drop in the jobless rate in 32 years.
“There is no doubt that this is a stunning set of job figures – especially considering that [the] nation’s second largest economy was in lockdown throughout the month,” said CommSec chief economist Craig James.
“More people were looking for jobs in August, more people found jobs and more employees are reconnected to their workplaces.”
The rise came despite Victoria’s restrictions which caused its unemployment rate to rise to 7.1 per cent. The Australian Bureau of Statistics noted 42,400 Victorian jobs were lost in the month of August.
But even with Victoria’s current situation, economists are optimistic, predicting more jobs will come back as restrictions are eased.
“With restrictions in Victoria set to be loosened toward year-end, employment should continue to rise,” noted Capital Economics senior economist Marcel Thierliant.
“The unemployment rate is now unlikely to climb to 8.5 per cent over the coming months as we had anticipated, let alone the 10 per cent predicted by the RBA and the Treasury,” he said.
Nevertheless Victoria does not have the nation’s worst unemployment rate – that title belongs to South Australia with 7.9 per cent.
The state with the lowest unemployment rate belongs to Tasmania with 6.3 per cent and two territories – the ACT & NT – are even lower at 4.3 per cent.