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Unemployment drops to under 2 million in July as economy re-opens

Source: Roy Morgan Single Source January 2019 – July 2020. Average monthly interviews 4,000. Note: Roy Morgan unemployment estimates are actual data while the ABS estimates are seasonally adjusted.

In July 12.5% of the workforce (1.79 million Australians) were unemployed. This is a significant drop of 262,000 on June as the Australian economy – with the exception of Victoria – continued to re-open.

An additional 1.5 million Australians were under-employed (10.5% of the workforce), up 92,000 on a month ago.

This means a massive 3.28 million Australians (23% of the workforce) were either unemployed or under-employed, an improvement of 171,000 on June according to the latest Roy Morgan employment estimates.

Compared to early March, before the nation-wide lockdown, there are an additional 1.12 million Australians now unemployed or under-employed (+7.4% points).

A look at the trends on a State-based level shows the biggest declines in unemployment in the month of July have been in Queensland, SA and Tasmania with the unemployment rates dropping by over 4% points in each of these States.

Unemployment is down by just over 1% point in both WA and NSW – which now has the lowest unemployment of any State.

Victoria is the outlier with unemployment virtually unchanged on a month ago. The new lockdown in Victoria has seen employment in the State decline around 80,000 on June while the number of Victorians looking for work has also dropped by around 20,000 as the workforce shrinks.

Latest Roy Morgan employment series data for July shows:

  • The workforce in July was 14,251,000 – comprised of 12,465,000 employed and 1,786,000 unemployed Australians looking for work. The workforce total is up 145,000 since June driven by a large increase in part-time employment;
  • 12,465,000 Australians were employed, up 407,000 from June including 8,013,000 employed full-time, up 79,000, and 4,452,000 employed part-time, up 328,000;
  • 1,786,000 Australians were looking for work, down 262,000 from June, driven by a fall in the number looking for part-time work which fell 165,000 to 979,000 while 807,000 were looking for full-time work, down 97,000;
  • Roy Morgan’s unemployment figure of 12.5% for July is significantly higher than the current ABS estimate for June 2020 of 7.4%. However, the ABS figure for June estimated a large decline in the size of the workforce since March which they said was down 416,000. The ABS also counted an additional 175,000 Australians who were working zero hours in June as ‘employed’; people who ‘had no work, not enough work available, or were stood down’. If these non-workers are added the ABS unemployment estimate for June increases to 1.58 million (11.9%).

Michele Levine, CEO Roy Morgan, says although most of Australia spent July opening up, the renewed lockdown in Victoria has put the recovery on hold for the State which represents around a quarter of the national economy:

“Roy Morgan’s unemployment measure for July shows 1.79 million Australians were unemployed (12.5% of the workforce) with an additional 1.5 million (10.5%) under-employed. In total a massive 3.28 million Australians (23% of the workforce) were unemployed or under-employed – down 171,000 on a month ago.

“This improvement is not unexpected as most of Australia continued to open up during July and the unemployment rates in Queensland, SA and Tasmania all dropped by 4% points or more on a month ago. All three have seen no community transmission of COVID-19 for at least two months.

“Unemployment also dropped by over 1% point in both WA and NSW – which now has the lowest unemployment of any State at 10.9%. NSW has kept its borders open to the rest of Australia until the recent severe outbreak in Victoria.

“The employment trends in July are positive, but the example of Victoria shows how any gains are put at risk by mistakes made in the containment of the virus. The Victorian laws to contain the virus have been progressively tightened since June but the trend of new cases suggests the current lockdown due to expire in mid-August will be extended into September and cause further economic damage to the State.

“The situation in Victoria is serving as a clear warning to other States, and particularly NSW, to do everything possible to get on top of new outbreaks to prevent COVID-19 re-emerging and forcing another damaging economic lockdown.

“To regain control of the situation in Victoria Premier Daniel Andrews is contemplating a New Zealand style lockdown to get on top of COVID19. If this is to be done it must be implemented immediately rather than waiting until the end of the current lockdown period which would only result in a longer period of lockdown than is necessary causing even more economic damage.”

Roy Morgan Unemployed and ‘Under-employed’* Estimates

Unemployed or

‘Under-employed’*

Unemployed

Unemployed looking for

‘Under-employed’*

Full-time

Part-time

2019

‘000

%

‘000

%

‘000

‘000

‘000

%

Jan-Mar 2019

2,604

19.2

1,345

9.9

635

701

1,259

9.3

Apr-Jun 2019

2,490

18.2

1,260

9.2

626

634

1,229

9.0

Jul-Sep 2019

2,261

16.6

1,188

8.7

520

667

1,074

7.9

Oct-Dec 2019

2,374

17.1

1,134

8.2

536

598

1,240

8.9

2020

Jan-Mar 2020

2,692

19.1

1,417

10.1

638

779

1,275

9.0

Apr-Jun 2020

3,466

24.6

2,099

14.9

937

1,162

1,367

9.7

Months

June 2019

2,529

18.6

1,254

9.2

605

649

1,275

9.4

July 2019

2,480

18.3

1,182

8.7

526

656

1,298

9.6

August 2019

2,130

15.8

1,179

8.7

454

725

951

7.1

September 2019

2,174

15.7

1,202

8.7

581

621

972

7.0

October 2019

2,307

16.7

1,075

7.8

441

634

1,232

8.9

November 2019

2,226

16.1

1,122

8.1

549

573

1,104

8.0

December 2019

2,588

18.6

1,205

8.7

619

587

1,383

9.9

January 2020

2,586

18.4

1,361

9.7

713

648

1,225

8.7

February 2020

2,443

17.3

1,174

8.3

517

658

1,269

9.0

March 2020 (Total)

3,046

21.6

1,715

12.2

684

1,030

1,331

9.4

March 2020 (Early)

2,161

15.6

1,019

7.3

402

617

1,142

8.2

March 2020 (Late)

3,923

27.4

2,407

16.8

960

1,447

1,516

10.6

April 2020

3,484

24.7

2,159

15.3

1,001

1,158

1,325

9.4

May 2020

3,459

24.5

2,090

14.8

907

1,183

1,369

9.7

June 2020

3,454

24.5

2,048

14.5

904

1,144

1,406

10.0

July 2020

3,284

23.0

1,786

12.5

807

979

1,498

10.5

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


This Roy Morgan survey on Australia’s unemployment and ‘under-employed’* is based on weekly face-to-face interviews of 695,772 Australians aged 14 and over between January 2007 and July 2020, and includes 5,803 telephone and online interviews in July 2020. *The ‘under-employed’ are those people who are in part-time work or freelancers who are looking for more work.

Roy Morgan Unemployment & Under-employment (2019-2020)

For further information:

Contact

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Mobile

Gary Morgan:

+61 3 9224 5213

+61 411 129 094

Michele Levine:

+61 3 9224 5215

+61 411 129 093


Unemployment Data Tables

Roy Morgan Research Employment Estimates (2001-2020)

Roy Morgan Research Unemployment & Under-employment Estimates (2005-2020)

Roy Morgan Research vs ABS Employment Estimates (1992-2020)

ABS Employment Estimates (1992-2020)


ROY MORGAN MEASURES REAL UNEMPLOYMENT IN AUSTRALIA
NOT THE ‘PERCEPTION’ OF UNEMPLOYMENT – JUNE 8, 2012

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 ABS classifies a person as employed if, when surveyed, a person worked for one hour or more during the reference week for pay, profit, commission or payment in kind, or even if a person worked for one hour or more without pay in a family business or on a farm.

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.

Sample Size

% Estimate

 

40%-60%

25% or 75%

10% or 90%

5% or 95%

5,000

±1.4

±1.2

±0.8

±0.6

10,000

±1.0

±0.9

±0.6

±0.4

20,000

±0.7

±0.6

±0.4

±0.3

50,000

±0.4

±0.4

±0.3

±0.2


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