Sharp fall in jobless rate shows economy on mend

Australia’s unemployment rate fell half a percentage point in February as almost 89,000 people found work through the month.

Figures from the Australian Bureau of Statistics on Thursday showed the national jobless rate dropped to 5.8 per cent, its best result since March last year.

The number of people out of work fell by 69,900 to 805,200. It is still 109,500 higher than February last year.Credit:Jessica Shapiro

Total employment is now back over 13 million, just 1800 short of the record set in February last year before the advent of coronavirus-related shutdowns across the economy.

Full-time employment lifted by 89,000, with 69,000 of those jobs going to women. Female full-time employment is now 1.8 per cent higher than March last year while male full-time employment is 0.8 per cent lower.

The number of people out of work fell by 69,900 to 805,200. It is still 109,500 higher than February last year.

Youth unemployment dropped by 1.1 percentage points but at 12.9 per cent is still half a percentage point higher over the past 12 months.

Victoria’s jobless rate fell by 0.7 percentage points. It and NSW now have the same unemployment rate of 5.6 per cent.

There were falls in unemployment in every state and territory, with the biggest drop in Queensland, where it fell 0.8 percentage points to 6.1 per cent. The lowest jobless rate is in the ACT at 4.1 per cent.

ABS head of labour statistics Bjorn Jarvis said there had also been a positive development in the number of hours worked through February, which increased by 6.1 per cent after a 4.9 per cent fall in January.

“Hours worked increased across all of the states and territories, except for in Western Australia, where hours were affected by the lockdown in the first week of February,” Mr Jarvis said.

Despite the strong result, there were also signs for concern.

The under-employment rate lifted by 0.3 percentage points to 8.4 per cent, pointing to ongoing slack in the labour market.

Victoria’s under-employment rate is at 9.1 per cent while in NSW it is 8.1 per cent.

The data also pre-dates the end of the JobKeeper wage subsidy, which finishes at the end of March. Analysts, Treasury and the Reserve Bank believe once it ends there is likely to be a lift in the unemployment rate.

The full impact of JobKeeper’s end is unlikely to be known until at least the May employment report from the bureau.

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