The Bureau of Statistics has released stronger than expected jobs data, showing 40,000 full-time and 18,600 part time jobs being created in the month of October, in seasonally adjusted terms.
The data follows improvements in both business and consumer confidence in the past week, tentatively supporting claims the economy is successfully transitioning from the resources boom to growth in other sectors.
But while the seasonally adjusted headline unemployment rate fell from 6.2 per cent to 5.9 per cent in October, the less volatile trend estimate of unemployment was unchanged at 6.1 per cent.
The participation rate also remained unchanged at 65 per cent.
The number of jobs created in October beat analyst forecasts by a factor of four – a huge boost for the economy if believed.
However, the ABS survey methodology was recently heavily criticised by the Bureau’s former head Bill McLennan.
Mr McLennan told Fairfax media in October: “The results of the last six months aren’t worth the paper they’re written on, so why are we wasting millions of taxpayers’ money on the survey?”
Head of financial markets for Bendigo Bank, David Robertson, told The New Daily the real unemployment situation was probably somewhere between the seasonally adjusted and trend figures, and that “people have to do their own smoothing” of the data.
However, he said that he was “happy to take a brighter view generally” of the economy in the months ahead.
“We’ve seen interest rates come down 2.75 percentage points in the past two-and-a-half years, and the Australian dollar fall 30 per cent in the same period. If you don’t get a tick up in employment in those circumstances, you never will.”
Mr Robertson said a 12 per cent increase in this week’s ANZ job ads survey and strong economic data from the US lent support to the lower unemployment figure being correct.