Labour Market Highlights Soft Economic Conditions

Thursday 12 July | Categories: Economic Policy

CCIQ (Chamber of Commerce and Industry Queensland) is pointing to economic data released today as evidence of soft economic conditions, and that more needs to be done to address Australia’s patchwork economy, the effects of which have hit Queensland businesses particularly hard.

A further cut to the official cash rate by the Reserve Bank of Australia at its August meeting would be widely supported after labour force statistics released by the Australian Bureau of Statistics showed that outside of Western Australia, unemployment is rising, the number of people in full-time work has decreased and the participation rate is down.

The country as a whole experienced an increase in the seasonally adjusted unemployment rate to 5.2 per cent, worsened by the fact that the participation rate fell by 0.2% to 65.2 per cent, and there were 33,500 fewer people in full-time employment.

Unfortunately the news isn’t any better in Queensland, where, despite a significant pipeline of resource sector projects, seasonally adjusted unemployment remains above the national average at 5.3 per cent and the participation rate fell by 0.7% to 66% to its lowest point in over 12 months. There were also 15,900 fewer people in full-time employment.

CCIQ supports a rate cut to ease the pressure on small and medium Queensland business in light of the difficult trading conditions and reduced business activity that persisted throughout the 2011-12 financial year. However, more action is required to address other issues caused by the patchwork nature of the economy, including widespread skills shortages, which limit opportunities for growth and hinder productivity.

A full comparison of state and national labour force figures is provided below and the ABS data is attached for information.

In seasonally adjusted terms, Queensland experienced:

• An decrease in the unemployment rate of 0.4% to 5.3%
• A decrease in full-time employment, which fell by 15 900 to 1,667,700
• An decrease in unemployment by 12,000
• Participation rate fell by 0.7% to 66%.

In trend terms,

• The unemployment rate stayed the same at 5.4%
• A decrease in full-time employment of 2,000 to 1,675,700
• The number of unemployed fell by 300
• The participation rate fell by 0.1%