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Australian April jobless rate at 9-mth high, employment rises

Published 17/05/2018, 12:38 pm
Updated 17/05/2018, 12:40 pm
© Reuters.  Australian April jobless rate at 9-mth high, employment rises

© Reuters. Australian April jobless rate at 9-mth high, employment rises

* April unemployment rate rises to 5.6 pct, a 9-mth high

* Jobs grew by 22,600 vs forecast of 20,000

* Full-time jobs rise by 32,700; part-time jobs slip 10,000

By Swati Pandey

SYDNEY, May 17 (Reuters) - Australia's jobless rate rose to a nine-month peak of 5.6 percent in April as more people entered the labour market, however, the number employed beat expectations with more full-time jobs added.

Thursday's figures from the Australian Bureau of Statistics showed the unemployment rate rose to 5.6 percent, the highest it's been since last July. It has remained between 5.4 percent and 5.6 percent for almost a year.

The participation rate climbed to 65.6 percent, near levels seen in early 2011, as more women entered the labour force.

Overall, 22,600 net new jobs were added in April, topping forecasts of 20,000. Full-time jobs jumped 32,700 compared with a fall of 25,100 in March.

Annual job growth of 2.7 percent was more than one and half times the U.S. pace of job creation of 1.6 percent.

With labour supply expanding to meet demand, there is less upward pressure on wages and inflation and thus no near-term trigger for a rise in interest rates from the Reserve Bank of Australia (RBA).

The RBA last cut rates to a record low 1.5 percent in August 2016 and is seen likely to keep policy unchanged for another year as it awaits a pick up in wage growth and consumer prices. 0#YIB:

Data out on Wednesday showed annual wage growth was a feeble 2.1 percent in the March quarter, half the rate enjoyed by workers during the decade-long mining boom that began in the early 2000s. spare capacity in Australia's labour market is one reason for the subdued wage outcome. The underutilisation rate, which includes the unemployed and those who want to work more hours, is close to 14 percent compared to 8 in the United States. Wage pressures in the United States have not picked up despite the lower underutilisation rate.

"It is difficult to see a meaningful pick up in wages given that employment growth is expected to be good for the remainder of 2018, but not spectacular," said Diana Mousina, senior economist at AMP.

"That means spare capacity in the labour market will remain an issue."

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