Thursday, March 20, 2014

Employment blues continue to play

The run of weaker employment data for Cairns continued in February with the latest ABS numbers out today. As always the Conus Trend provides the best acoustics to remove statistical and seasonal noise: Poor jobs data throughout North Queensland

If we now look at the far more relevant Conus Trend data the picture becomes clearer, but no more positive. In Cairns the only bright note is that Conus Trend employment, which has been falling every month since Mar 2013, finally registered an unchanged plot. The Conus Trend Participation Rate continued to slide (down to 61.5, the lowest level since we began the Trend series over 6 years ago) and the Conus Trend Unemployment Rate remained stuck at 8.5% (where it has now been since Nov 2013, following upward revisions to previous months). The Conus Trend Employment/Population ratio now sits at a new record low of just 56.5.
I'm still curious about some aspects of the changes made last month to statistical regions after trying to correlate some employment numbers between the new and old areas which didn't seem to make sense. Following last weeks widely reported job surge in the national data I also noted another rant from Ricardian Ambivalence: "Getting right to the point,  my view is that the Feb 2014 jobs report is bunkum"

Mr Ambivalence is always keen to point out that the labour force survey is designed to measure an unemployment rate rather than employment. However I have always thought that the employment numbers and trend must at least have some validity over time with our volatile regional data.

With the new (raw) regional data extending back to 1998 this month I have graphed the unemployment rate for Cairns v Queensland. This displays the percentage point difference between the two with a 12 month moving average:

Up until 2004 the unemployment rate in Cairns was on average below the Queensland rate. It may be possible here to conjecture a relationship between the subsequent period of a higher unemployment rate and the shift to a higher $AUD as a factor of significance?

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