SYDNEY: Australian employment fell sharply for a second month in September as coronavirus lockdowns forced firms to lay off workers, while the jobless rate was held down by another big drop in the number of people looking for work.
Policy makers are counting on a recovery in coming months as rapid progress in vaccinations has allowed restrictions to ease in Sydney, with Melbourne and Canberra soon to follow, report agencies.
The jobless rate edged up to 4.6 per cent, from 4.5 per cent, but has been artificially held down by the restrictions which prevent people looking for work and being counted as unemployed.
“The low national unemployment rate continues to reflect reduced participation during the recent lockdowns, rather than strong labour market conditions,” said Bjorn Jarvis, head of labour statistics at the ABS.
The participation rate fell 0.7 percentage point in September to 64.5 per cent, a long way from a record high of 66.2 per cent hit in June. As this shift unwinds, the unemployment rate could well rise in the next few months even as employment recovers.
The Reserve Bank of Australia (RBA) has cautioned that unemployment will likely top 5 per cent by year end, though it is optimistic activity will pick up quickly as the lockdowns ease.
The central bank still believes the jobless rate will need to get down to 4% or lower to drive a sustained, and much needed, lift in wages and inflation.