Finance Finance News Jobless rate climbs to 5.3% in October
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Jobless rate climbs to 5.3% in October

The unemployment rate climbed to a seasonally adjusted 5.3 per cent in October as both full-time and part-time work contracted. Photo: AAP
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The unemployment rate climbed to a seasonally adjusted 5.3 per cent in October as the economy lost 19,000 jobs during the month.

Thursday’s worse-than-expected result featured a 10,300 decrease in people with full-time work and a 8700 decrease in people with part-time work, according to data from the Australian Bureau of Statistics.

Most economists had expected the unemployment rate to remain unchanged at 5.2 per cent, and the Australian dollar dropped almost 0.5 per cent against the US dollar within 10 minutes of the data being released, hitting a new four-week low 68.06 US cents.

The figures offer more evidence that three Reserve Bank rate cuts since June and government tax offsets have failed to lift consumer spending or give businesses the incentive to expand, hire more people, or offer more hours.

Underemployment increased by 0.2 percentage points to 8.5 per cent during October – widening the labour market slack that has kept a lid on wages growth.

Labor’s employment spokesman Brendan O’Connor said that figure was proof the economy was floundering.

“Almost 2 million Australians are looking for work, or for more work, but unable to find it,” he said.

Economists said another cut to official interest rates was increasingly likely early next year.

The RBA does not meet in January so, chances of a December cut still slim, that suggests a February move.

“The data clearly confirms that there is plenty of slack in the economy; (and) reinforces our view that the RBA will cut the cash rate again, in early 2020, to further support domestic demand,” BIS Oxford chief economist Sarah Hunter said.

The seasonally adjusted unemployment rate increased by 0.3 points in NSW to 4.8 per cent, as employment decreased by 10,300 people.

The jobless rate in Victoria rose by 0.1 points to 4.8 per cent despite 2,900 more people finding work, while it decreased by 0.1 points in Queensland to 6.5 per cent even as 14,000 people lost work.

Tasmania’s unemployment edged 0.2 points lower to 5.9 per cent while Western Australia and South Australia recorded no change.

-AAP