Finance Finance News Jobless rate holds steady

Jobless rate holds steady

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Australia’s unemployment rate held steady at 5.8 per cent last month, amid emerging signs that the jobs market is starting to strengthen.

The total number of people with jobs rose 14,200 to 11.57 million in April, according to the latest seasonally adjusted figures from the Australian Bureau of Statistics.

An AAP survey of 11 market economists, conducted before the release of the official data, showed that the median forecast was for the unemployment rate to rise 0.1 per cent to 5.9 per cent.

Full-time employment rose 14,200 to 8.05 million during the period. Part-time employment was unchanged at 3.53 million.

The Australian dollar rose in the minuted after the better-than-expected announcement, rising to 93.50 US cents at 1140 AEST from 93.29 US cents shortly before the jobs data was released.

” … We’re seeing some positive surprises for employment, rather than some of the negative results that we saw last year,” Joshua Williamson, senior economist at investment bank Citi, told the ABC.

However, Mr Williamson added that an overly restrictive Federal Budget could have a negative impact on business sentiment.

“Some of the measures that are designed to cut expenditure growth could have negative implications for business confidence; if that’s the case, we may not see some businesses actually hire or they may actually moderate their hiring plans,” he said.

“So, if anything, that potentially could dampen employment growth a little bit in the short term.”

Earlier this week, the OECD warned the government not to be too heavy handed in its attempt to get the budget in better shape, predicting unemployment will peak above six per cent and remain stubbornly high into late 2015.

RBC Capital Markets senior economist Su-Lin Ong said the figures alone would not change the outlook for the RBA’s cash rate.

“The market is a little bit complacent about how long the cash rate will remain unchanged,” she said.

“If we get continued employment generation and ongoing improvement in the leading indicators for employment, then the RBA would be unlikely to stay on hold.”

South Australia was the only state to record a decline in the jobless rate in April, tumbling to 6.3 per cent from 7.1 per cent.

In the nation’s largest state, NSW, it rose to 5.4 per cent from 5.2 per cent and in Queensland it increased to 6.3 per cent from 6.1 per cent.

In the ACT, which could bear the brunt of the federal government’s budget cuts, the unemployment rose to 3.6 per cent from 3.5 per cent.

Rates in Victoria (6.4 per cent), Western Australia (4.9 per cent), Tasmania (7.6 per cent) and the Northern Territory (3.8 per cent) were all unchanged from a month earlier.