Australian unemployment falls to 7.8% in June – equal to lowest level since pandemic began

In June, the unemployment rate fell for a second month in a row, by 0.3% to 7.8%, according to the latest monthly employment data from Roy Morgan. The drop in unemployment was driven by an increase in full-time jobs, which increased the total number of Australians in employment.

June unemployment fell by 44,000 to 1.13 million Australians (7.8% of the labor force), while underemployment fell slightly by 13,000 to 1.23 million (8.5% of the labor force). Total unemployment and underemployment fell by 57,000 to 2.35 million (16.3% of the labor force).

• The labor force grew by 78,000 in June due to rising employment:
  The labor force in June was 14,491,000 (up 78,000 from May) – made up of 13,366,000 employed Australians (up 122,000) and 1,125,000 unemployed Australians looking for work (down 44,000).

• An increase in employment caused by an increase in full-time employment:
  Employment in Australia increased by 122,000 to 13,366,000 in June, led by a 363,000 increase in full-time employment to 8,876,000. This represents a new all-time record for full-time employment in the first full month of the new Albanese government. In contrast, part-time employment fell by 241,000 to 4,490,000 in June, returning to near its level in April before the jump caused by May’s federal election.

• Strong growth in full-time employment led to a drop in unemployment in June:
  1,125,000 Australians were unemployed (7.8% of the workforce)down 44,000 from May with fewer people looking for full-time work, up 68,000 to 409,000, while in contrast there was a slight increase in those looking for part-time work, up 24,000 to 716 000.

• Underemployment was little changed in June to 1,226,000:
  

  In addition to the unemployed, 1,226,000 Australians (8.5% of the labor force) were underemployed – working part-time but looking for more work, down just 13,000 from May.
  A total of 2,351,000 Australians (16.3% of the labor force) were either unemployed or underemployed in June, down 57,000 from May.

Compared to early March 2020, before the nationwide lockdown, there were almost 200,000 more Australians either unemployed or underemployed in June 2022 (+0.7% points), although total employment (13,366,000 ) is almost 500,000 higher than it was before COVID-19 (12,872,000).

Roy Morgan’s unemployment of 7.8% for June was double that May 2022 ABS Forecast of 3.9%. However, ABS figures for May show there were 780,500 workers who worked fewer hours than usual due to illness, personal injury or sick leave, compared to an average of 407,540 for the month of May over the five years to May 2017. until May 2021

This difference, which can be attributed to the Omicron variant of COVID-19, equates to a difference of 372,960 in May 2022 over the May average of the previous five years. If these workers are added to the 548,100 classified as unemployed, it creates a total of 921,060 – or 6.6% of the labor force. In addition, the ABS classifies 5.7% of the labor force (approximately 808,000 workers) as underemployed. Combining these figures adds up to 1.73 million workers, about 12.3% of the workforce.

Roy Morgan Unemployment and Underemployment (2019-2022)

Source: Roy Morgan Single Source January 2019 – June 2022 Average monthly interviews 5,000.
Note: Roy Morgan unemployment estimates are actuals, while ABS estimates are seasonally adjusted.

Michelle Levine, chief executive of Roy Morgan, says the jobless news is a boon on employment for the new ALP government in June, with full-time employment hitting a new record and leading to the lowest unemployment rate since October 2019 year:

“Roy Morgan’s latest employment estimates for June show that full-time employment rose by 363,000 to 8,876,000 in June, a new record. The increase in full-time employment boosted total employment by 122,000 to 13,366,000, although part-time employment fell in June after a temporary spike seen in May due to the federal election.

“The strong employment result pushed unemployment down to 1,125,000 (7.8% of the labor force) – the lowest unemployment rate since October 2019, well before the COVID-19 pandemic. However, there are an additional 1,226,000 Australians (8.5% of the labor force) who are now underemployed, meaning there is still a large group of 2.35 million Australians who are now unemployed or underemployed.

“While employment news has been positive in the first month of the new ALP government, there are clearly several challenges facing policymakers over the next few months, including rising inflationary pressures, the RBA raising interest rates to quell inflation and credibility (and costs ) in the Australian energy market – particularly along the east coast.

“All of these challenges are interrelated and could lead to rising unemployment levels in the future if not addressed. For the foreseeable future, global energy and food prices are expected to continue to rise due to the conflict in Ukraine, as well as domestic factors such as the recent floods in Queensland and New South Wales.

“On the domestic front, the wild weather seen in many parts of Australia will hopefully ease over the next few months, allowing food prices to normalize, but a key priority for the government must be to bring security to the domestic energy market.”

“By stabilizing the domestic gas and electricity market, the government can reduce price pressures on these key energy commodities, which will reduce inflationary pressures and allow the RBA to end its rate hike cycle sooner than some expect.”

“If the Albanese government allows Australia’s energy situation to deteriorate further over the next few months and years, they will end up causing persistently higher inflation in the economy, which will certainly put their re-election in three years’ time at risk.”

Roy Morgan’s Estimates of Unemployed and ‘Underemployed’*

*The labor force includes the employed and those looking for work – the unemployed.

This study by Roy Morgan for Australia unemployment and “partly occupied”* based on weekly interviews of 839,202 Australians aged 14 and over between January 2007 and June 2022 and includes 5,913 telephone and online interviews in June 2022. *The “underemployed” are those people who work part-time or freelance who are looking for more work.

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Roy Morgan Research see ABS estimates of unemployment

Source: Roy Morgan Single Source October 2006 – June 2022 Average monthly interviews 4,000.
Note: Roy Morgan unemployment estimates are actuals, while ABS estimates are seasonally adjusted.

Roy Morgan Research see ABS estimates of unemployment

Source: Roy Morgan Single source January 2000 – June 2022. Average monthly interviews 4,000.
Note: Roy Morgan unemployment estimates are actuals, while ABS estimates are seasonally adjusted.

Source: Roy Morgan Single Source April 1995 – June 2022 Average monthly interviews 4,000.
Note: Roy Morgan’s unemployment estimates are actual data, while ABS estimates are seasonally adjusted.