Australia’s unemployment rate has fallen in September, with the drop in joblessness attributed to a fall in Australians looking for work.
The Australian Bureau of Statistics revealed on Thursday that the nation’s jobless rate slipped slightly to 5.2 per cent for the month, a stronger than expected result.
Meanwhile, Australia’s underemployment rate, which measures the amount of Australians who have jobs but do not have enough hours, had dropped slightly to 8.3 per cent.
There was also an 8,100 person drop in the number of unemployed people.
Australia’s unemployment rate was driven by a drop in the participation rate, which fell marginally to 66.1 per cent.
The unemployment rate has resulted in three years of unbroken jobs growth.
“The RBA will breathe a sigh of relief,” Capital Economics’ senior economist Marcel Thieliant said.
Unemployment figures varied across the country.
WA’s rate fell 0.1 percentage points to 5.7 per cent, Victoria’s rate fell from 4.9 per cent to 4.7 per cent and Tasmania fell from 6.4 to 6.2 per cent.
NSW’s unemployment rate rose to 0.2 percentage points to 4.5 per cent, Queensland’s rate rose to 6.5 per cent and the Northern Territory rose to 5.6 per cent.
The Act remained steady at 3.5 per cent.
BIS Oxford Economics chief economist Sarah Hunter said wage growth was likely to be elusive despite the fall in unemployment because of the fall in participation rate.
“It suggests that some people may be formally dropping out of the labour force because they can’t find a suitable position,” Ms Hunter said.
“In these circumstances, the lower unemployment rate is unlikely to lead to an acceleration in the pace of wage rises; those that have left the labour force can easily re-enter when conditions improve.”
However, despite the fall in the unemployment rate, Mr Thieliant said he expected the rate to rise.
“We think it won’t be long before unemployment starts to rise again, forcing the RBA to provide additional stimulus,” he said.
“We are sticking to our forecast that the unemployment rate will climb to 5.5 per cent by early next year.”