As it stands | Labour Force Survey
Employment growth remained constructive throughout the first half of 2019, though it finished on a disappointing note with the net addition of just 500 jobs in June, which fell well short of the 9,000 increase expected. That was the weakest outturn in 11 months and the first downside miss on the consensus figure since February earlier this year. From a month earlier, the pace of employment growth through the year retraced from 2.9% to 2.4%.
With the workforce participation rate holding at its record high level of 66.0% initially achieved in May, the unemployment rate was unchanged at 5.2%. However, the broader measures of underutilisation saw some improvement in June with the underutilisation rate falling from 13.7% to 13.4% and the underemployment rate coming down from 8.6% to 8.2% -- effectively a reversal of the rises from the preceding two months. Following back-to-back monthly declines, aggregate hours worked held flat in June at 1.77bn hours to be 1.6% higher over the year but down from the 2.1% pace in May. To read our full review of June's report see here
Market expectations | Labour Force Survey
A stronger outcome for employment growth is expected today, with the median forecast compiled by Bloomberg pointing to a net 14,000 jobs being added to the economy in July between a wide range of estimates from -10,000 to +37,000. For the fourth straight month, the unemployment rate is expected to print at 5.2% situated between estimates from 5.1% to 5.3%. The participation rate is anticipated to keep up its record level of 66.0%, which is on the high side of the range of estimates with 65.8% being the lowest.
A stronger outcome for employment growth is expected today, with the median forecast compiled by Bloomberg pointing to a net 14,000 jobs being added to the economy in July between a wide range of estimates from -10,000 to +37,000. For the fourth straight month, the unemployment rate is expected to print at 5.2% situated between estimates from 5.1% to 5.3%. The participation rate is anticipated to keep up its record level of 66.0%, which is on the high side of the range of estimates with 65.8% being the lowest.
What to watch | Labour Force Survey
Today's employment number (expected: +14,000) will be important, with markets likely to be unsettled by another weak outcome following on from June's net increase of just 500 that would be indicative of a notable deterioration in conditions. The unemployment rate is also key, which at two deimal places lifted from 5.19% in May to 5.24% in June. If, as expected, the participation rate remains at 66.0% the risk in today's report is that the unemployment rate misses the consensus forecast and prints at 5.3%, which would take it to its highest since August 2018 and further away from the 4.5% level the RBA estimates to be consistent with the nation's level of full employment.
Today's employment number (expected: +14,000) will be important, with markets likely to be unsettled by another weak outcome following on from June's net increase of just 500 that would be indicative of a notable deterioration in conditions. The unemployment rate is also key, which at two deimal places lifted from 5.19% in May to 5.24% in June. If, as expected, the participation rate remains at 66.0% the risk in today's report is that the unemployment rate misses the consensus forecast and prints at 5.3%, which would take it to its highest since August 2018 and further away from the 4.5% level the RBA estimates to be consistent with the nation's level of full employment.
