06/11/2008 - 09:28

WA jobless rate tumbles in October

06/11/2008 - 09:28


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Western Australia's jobless rate for October has been described as "sensational" as the figures tumbled towards record lows while the national rate held steady.

Western Australia's jobless rate for October has been described as "sensational" as the figures tumbled towards record lows while the national rate held steady.

The Australian Bureau of Statistics revealed that the state's unemployment rate had fallen from the previous month's 2.9 per cent, seasonally adjusted, to 2.2 per cent in October.

CommSec chief equities economist Craig James said WA's figure, along with Tasmania's, are at record lows.

"The Western Australia result is sensational," Mr James said.

"An unemployment rate of just 2.2 per cent and almost 13,000 jobs created in the month.

"If it wasn't for the soggy NSW economy, the national picture would look even brighter."

In New South Wales the unemployment rate spiked to 5.2 per cent in October from 4.8 per cent in September.

Nationally the unemployment rate for October was steady at 4.3 per cent, seasonally adjusted.

The number of people employed nationally rose by a seasonally-adjusted 34,300 in October, although full-time employment fell by 9,200.

Economists had expected total employment to decline by 10,000 and the jobless rate to rise to 4.4 per cent.

"The strong jobs results will silence the doomsayers - at least for now," Mr James said.

"The job market will soften in the coming months and unemployment will creep higher.

"But the lift in the jobless rate will occur mainly because businesses will be more reluctant to put more staff on rather than making knee jerk decisions to cut positions."

While some analysts are optimistic over the jobless rate, others say the data is misleading.

"Full time employment was down 9,200, and the Reserve Bank of Australia is usually more attentive to what is happening to full time employment than total employment as a labour market indicator," HSBC chief economist Australia and New Zealand John Edwards said.

"The fall in full time employment in October follows a 15,500 fall in full time employment in September.

"Employment also typically lags changes in demand and output. The weakness of retail sales and building approvals, and the decline in credit growth, consumer confidence and business confidence are more contemporary signals of the Australian economic slowdown.

Other than the business investment survey on November 27, today's jobs number is the most important release before the December 2 RBA board meeting. Even so, we still expect the RBA to cut again, and by 50 basis points. "

In Queensland, the jobless rate rose to 3.8 per cent from 3.7 per cent and in the Northern Territory it increased to 3 per cent from 2.9 per cent.

In Tasmania it nudged down to 3.5 per cent from 3.6 per cent.

Unemployment rates in Victoria (4.4 per cent) and the ACT (2.7 per cent) remain unchanged.

The federal government lifted its unemployment forecasts in yesterday's mid-year budget review.

It expects the jobless rate to hit 5.0 per cent by June next year and 5.75 per cent a year later.




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