Today’s unemployment figures from the ABS confirm a lacklustre economic outlook for Queensland over 2013-14 as the resources sector slows down, but I think it’s too early to conclude we’re heading for anything worse than expected. That is, based on today’s data, I wouldn’t yet revise Treasury’s Queensland Budget forecast of average unemployment over 2013-14 of 6 per cent. While the seasonally adjusted unemployment rate increased to 6.4 per cent in June from 5.9 per cent in May, it needs to be kept in mind that the seasonally adjusted rate is pretty volatile from month-to-month (see charts below).
Queensland Treasury isn’t over-reacting to today’s figures either, with its information brief noting:
Despite an increase in the number of unemployed and a fall in employment in June 2013, Queensland’s trend unemployment rate remained at 6.0% in the month (see Chart 1), with the trend unemployment rate for May 2013 upwardly revised 0.3 percentage point to 6.0%.
Let’s wait a few more months and see if the trend unemployment rate gets much worse before worrying much more about the state of the economy. As I’ve noted previously, the unemployment rate is still really not that high from an historical perspective:
By the way, on the resources sector slowdown, Mark Beath of Loose Change made some nice observations today in his post: