The last employment report for 2012 delivered a bit of a double whammy (seas adjusted) – a rise in the number of unemployed and a decline in the number of employed.
The numbers for Dec 2012 (v. Nov 2012), seasonally adjusted:
Total employed people decreased by 5.5k
- The average change over the last 10 years (for Dec v Nov) was +16.6k. So, not a good result in this December report
- The decline was driven by a decrease in FT persons, mostly female. Total FT jobs -13.8k.
- This was offset by growth in PT jobs for males. Total PT employment +8.3k.
Number of unemployed people grew by 16.6k:
- The average change over the last 10 years (Dec v Nov) was a decrease in total unemployed of -4.7k. The Dec 2012 result is well above trend.
- The increase was driven by growth in FT & PT unemployed (FT grew faster).
The net impact on the labour force was an increase of +11k people. This increase was driven by the growth in total unemployed. Note that the average change in the labour force in Dec v Nov over the last 10 years was +11.9k.
Below is a comparison of seas adjusted & trend data – trend data has the unemployment rate holding steady, with a much smaller increase in total unemployed and an increase in total employed.
|Number of employed persons||-5.5k||+7.0k|
|Full Time Jobs||-13.8k||+6.1k|
|Part Time Jobs||+8.3k||+0.9k|
|Number of unemployed persons||+16.6k||+1.4k|
|Unemployed looking for FT||+12.6k||-0.1k|
|Unemployed looking for PT||+4k||+1.5k|
|Labour force size||+11k||+8.4k|
|Unemployment rate total||5.4% (last mth 5.3%)||5.4% (last mth 5.4%)|
|Males||5.4% (last mth 5.3%)||5.4% (last mth 5.4%)|
|Females||5.3% (last mth 5.2%)||5.3% (last mth 5.3%)|
Full Year 2012
Compared to previous years, employment growth throughout 2012 remained lacklustre, sitting well below the 5 year moving average.
Whilst the growth was low, total employed persons still grew by 148.3k (Dec 12 v Dec 11). I’ll put that into perspective. The average growth in total employed persons over the last 10 years (including 2011’s shocker of 49k) was +225k. The 2012 overall result is well below this average.
Total unemployed is also higher than where we started 2012.
Total unemployed is +36k (Dec 12 v Dec 11) for the year. The average change for Dec v prior year over the last 10 years has been -4.8k. This average masks some big job loss years such as 2009 when total unemployed grew by +116k. Whilst it isn’t a huge year for growth in total unemployed, it is higher than our recent average.
All the while that unemployment rate just keeps creeping ever so slightly higher….
This is a good chance to recap on other alternative indicators of the state of the labour market.
Unemployment benefits paid (CPI adjusted) has continued to grow – for the Sept 2012 qtr, unemployment benefits rose by 8.7% versus Sept 2011, full year to Sep 2012, +7.4%.
Source: ABS 5206.19 & 6401.01
What is interesting about this chart is that it suggests that unemployment may be higher now than during the GFC in Australia– given that benefit payments (adjusted for CPI) are still higher than the peak reached in Mar ‘10. But the actual number of unemployed, according to the ABS, is still below that of the peak in 2009 (but edging back up).
There has been well documented discussion with regard to the difference between ABS & Roy Morgan unemployment reports. The Roy Morgan report suggests that unemployment is much higher (just under 10%) than what is reported by the ABS. The unemployment benefits paid are one indicator suggesting that the number of unemployed may indeed be higher than we think.
The aggregate hours worked also provides some interesting insight into the state of the economy.
Growth in aggregate hours worked continues to slow. But this is different to recession times.
It seems that during recessions, FT hrs decline and PT hrs grow. These two measures usually move in opposite directions. The more concerning thing about this latest trend is that both FT & PT hrs are moving in tandem – growth is slowing for both. Lets hope the uptick during Nov & Dec ’12 is maintained.
See longer term growth chart below. I’m not sure that there has been another point in time where growth in both FT & PT hours has slowed to zero at the same time. Either way, it’s a good indicator as to the state of the economy.
Here is the raw trend data for both FT & PT aggregate hours worked. It’s a reminder that hours worked are still high…but growth is slowing…