This afternoon I caught up with Ben Scott, who works as a Research Assistant in my business Adept Economics, to discuss the April Labour Force data published by the ABS today, as well as the possible shape of the eventual economic recovery (e.g. v-shaped, u-shaped, or Nike swoosh). I’ve uploaded our conversation, recorded using Zoom, to YouTube.
Pete Faulkner has a great summary of today’s data in his latest Conus blog post in which he notes:
…the real surprise came was in the unemployment rate. This had been forecast anywhere from about 8-9% (with some outliers even suggesting as high as 10%). The reality was a rather more pedestrian, and very surprising, lift to just 6.2%. The culprit for the wide miss was the fact that the Participation rate (the proportion of the working age population who are either in work or looking for work) fell a record 2.5 ppts to just 63.5. Had the PR remained at its previous level of 66 then the unemployment rate would have risen to 9.7%.
So, as I mentioned in my chat with Ben, the Australian unemployment rate is effectively nearly at 10%, if we count the people who gave up looking for work as effectively unemployed. Performing the same calculation Pete made for Australia using the Queensland data, the Queensland unemployment rate would be 10.6% instead of 6.8%, if we hadn’t had huge numbers of people give up the search for work and drop out of the labour force.