Australia’s jobless rate is expected to drift higher, despite the recent pickup in economic data and consumer and business confidence.
The unemployment rate is forecast to rise to 5.7 per cent, from 5.6 per cent, when official labour force figures for October are released on Thursday, according to an AAP survey of 15 economists.
The number of people with jobs is expected to rise by 5,000 while the participation rate – the percentage of the working-age population either in work or looking for a job – is expected to remain at 64.9 per cent.
Although there has been a recent uptick in business and consumer confidence, it’s still too early for that sentiment to have filtered into the economy, BlackRock head of Australian fixed income Steve Miller said.
“It’s quite clear that there has been a strong bounce in business and consumer confidence post election, but I think it’s probably too early for that to have fed into the numbers,” Mr Miller said.
“Australia is still growing below trend and if we’re still growing below trend, employment growth is generally weaker and the unemployment rate should generally drift higher.”
HSBC chief economist Paul Bloxham said employment would improve in coming months as economic activity begins to pick up.
“We think that October will still see the labour market looking loose but we think that, in coming months, we’ll start to see a bit of an improvement as the pickup in confidence and asset prices feeds through to some more employment,” Mr Bloxham said.