Record number of Australians employed in February as unemployment falls to 10%

• A record 13,174,000 Australians are in the workforce (up a large 648,000 since February 2015) and a record 11,855,000 Australians are employed (up a large 710,000 since February 2015);
  
  
• Now 7,817,000 Australians are employed full-time – up 414,000 since February 2015 and more than half that number, 4,038,000 Australians, are employed part-time (up 296,000 since February 2015);
  
  
• Unemployment has decreased after four straight rises to 1,319,000 Australians: still a high 10.0% of the workforce – down 62,000 since February 2015 with the unemployment rate down 1% and there are 1,161,000 Australians under-employed – working part-time and looking for more hours: 8.8% of the workforce – unchanged in terms of numbers (but down 0.5% as the Australian workplace grew substantially over the last year) since February 2015;
  
  
• Now 2,480,000 Australians are unemployed or under-employed: a massive 18.8% of the workforce – although down 62,000 (down 1.5%) since February 2015.

*Workforce includes those employed and those looking for work – the unemployed.

Gary Morgan says why the Australian & US economies are in ‘trouble’:

“In February Australia’s real employment increased to a record 11.855 million (up a large 710,000 from a year ago) with full-time employment of 7.817 million (up 414,000) and part-time employment of 4.038 million (up 296,000). Despite challenging global economic conditions over the past year with economic instability in Australia’s largest trading partner China, and the beginning of the end of the mining boom, Australia’s economy is rebalancing and providing new jobs in industries like property and real estate.

“Despite the strong growth in employment over the last year Australian unemployment 1.319 million (10.0% of the workforce) and under-employment 1.161 million (8.8% of the workforce) are still far too high. A total of 2.48 million Australians (18.8% of the workforce) are now unemployed or under-employed – working part-time but looking for more work or for full-time work.

“The typical seasonal trends in the February employment markets were evident again this year with those looking for part-time work increasing to 730,000 (up 80,000) and those looking for full-time work falling to 589,000 (down 107,000). This is the eighth time in ten years part-time unemployment has increased in February and looking further back part-time unemployment has increased in 10/15 years in February. In addition, full-time unemployment has fallen 10/15 years in February.

“These trends ‘play out’ in February each year as students at high school, and in particular University, return to their studies and look for part-time work to support themselves instead of the full-time work they were able to undertake over the summer period (November – January). Full-time unemployment is now at its lowest since October 2015 at the end of last year’s University exam period.

“In terms of the Australian economy, last week the ABS showed the Australian economy growing at 0.6% in the December Quarter and 3.0% for the year as a whole. In addition ABS Business Indicators figures showed the taxable profits of the real estate industry reached a new record high of $8.6 billion in the December Quarter 2015, more than double the taxable profits of the mining industry of $3.6 billion – the lowest taxable profits for the mining industry since December Quarter 2004. These figures clearly illustrate the importance of the real estate and property industries to the economy as the decade-long mining boom ends.

“The long-running Roy Morgan unemployment estimate shows real Australian unemployment (10.0%) is consistently higher than reported by the ABS (6.0%) – and the higher Roy Morgan unemployment estimate ‘makes sense’ when one considers the record low wages growth. The ABS unemployment figures released monthly lack credibility. ABS estimated unemployment of 6.0% in January – recognised as a figure close to ‘full employment’. The ABS also reports Australian wage growth at a record low of only 2.2% in 2015. These two figures don’t make sense.

“The economic fact is that when an economy approaches full employment, wages growth throughout the economy accelerates and this causes inflation. This isn’t happening in Australia, and nor is it happening across the Pacific in the United States. The US Bureau of Labor Statistics claims US unemployment of only 4.9% on the most reported measure. However, a broader definition of US unemployment also released by the BLS (called U6) shows real US unemployment of 9.7%.

“This higher US unemployment estimate (9.7%) is a much closer estimate of the real level of unemployment in the United States and very close to Australia’s level of real unemployment (10% according to Roy Morgan). Both businesses and Governments in Australia and the USA do their economic modelling based on the wrong unemployment data. While Governments continue to use ‘wrong data’ there will be a large group of people (unemployed and under-employed) who will be disenfranchised and angry with the Government of the day.”

This Roy Morgan survey on Australia’s unemployment and ‘under-employed’* is based on weekly face-to-face interviews of 472,038 Australians aged 14 and over between January 2007 – February 2016 and includes 3,934 face-to-face interviews in February 2016.

*The ‘under-employed’ are those people who are in part-time work or consultants who are looking for more work. (Unfortunately the ABS put their ‘heads in the sand’ and refuse to accept the reality and does not release this figure in their monthly unemployment survey results).

For further information: 

Unemployment Data Tables

Roy Morgan Research Employment Estimates (2001-2016)

Roy Morgan Research Unemployment & Under-employment Estimates (2007-2016)

Roy Morgan Research vs ABS Employment Estimates (1992-2016)

ABS Employment Estimates (1992-2016)

ROY MORGAN MEASURES REAL UNEMPLOYMENT IN AUSTRALIA

http://www.roymorgan.com/~/media/Files/Papers/2012/20120603.pdf

The Roy Morgan Unemployment estimate is obtained by surveying an Australia-wide cross section by face-to-face interviews. A person is classified as unemployed if they are looking for work, no matter when.

The results are not seasonally adjusted and provide an accurate measure of monthly unemployment estimates in Australia.

The Australian Bureau of Statistics Unemployment estimates are obtained by mostly telephone interviews. Households selected for the ABS Survey are interviewed each month for eight months, with one-eighth of the sample being replaced each month. The first interview is conducted face-to-face. Subsequent interviews are then conducted by telephone.

The ABS classifies a person as unemployed if, when surveyed, they have been actively looking for work in the four weeks up to the end of the reference week and if they were available for work in the reference week.

The Australian Bureau of Statistics Unemployment estimates are also seasonally adjusted.

For these reasons the Australian Bureau of Statistics Unemployment estimates are different from the Roy Morgan Unemployment estimate. Gary Morgan's concerns regarding the ABS Unemployment estimate is clearly outlined in his letter to the Australian Financial Review, which was not published.

Margin of Error

The margin of error to be allowed for in any estimate depends mainly on the number of interviews on which it is based. The following table gives indications of the likely range within which estimates would be 95% likely to fall, expressed as the number of percentage points above or below the actual estimate. The figures are approximate and for general guidance only, and assume a simple random sample. Allowance for design effects (such as stratification and weighting) should be made as appropriate.