Thursday, November 8, 2012

Employment v Interest Rates

The labour market has been a focus of the polarisation of opinion between those who think the RBA shoulda cut, and those who think they shouldna cut before anyway. I doubt that today's labour force data frfom ABS will resolve that difference.

The headline (seasonally adjusted) outcome was a rise in employment and a slight fall in the unemployment rate. Within that there are some weaker indicators, most particularly in aggregate hours worked. The trend rate of unemployment nudged up a notch.

Queensland continues to look relatively weak in recent months. Trend unemployment rate in Queensland also ticked up however it is the participation rate trend in Queensland that should probably be of most concern.

The trend participation rate in Queensland is the lowest since 2006 despite the unemployment diverging to the upside of the national average. During calendar 2012 the national trend participation rate has nudged down by 0.2% while Queensland trend has fallen by 0.9%, although it still remains above the national rate.

Some of the more interesting wonky data and comments on the labour market and interest rates in the last week have been at Ricardian Ambivalence. As usual Mark the Graph is quick off the mark with  an excellent range of charts including comparison of the state trend unemployment rates:

Earlier today New Zealand released some quite weak labour market stats. I recall recent reports of stronger inward migration across the ditch in the last year so that could also be a trend to watch.

Update: As soon as I posted that Grogs Gamut also has just posted some commentary and lots of graphs including a particular focus on the recent weakness in Queensland. 

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