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The “real” unemployment rate is down, but still much higher than you think

One of the biggest drivers of our property markets is consumer confidence.

And one of the important factors in consumer confidence is job stability. job employment

While “official” unemployment rates seem low, Roy Morgan research suggests a total of 2.390 million Australians, 17.9% of the workforce, were either unemployed (1,253,000) or under-employed (1,137,000) – down 90,000 (down 0.9%) from February 2016.

Unemployment is less than a year ago with 1.253 million Australians now unemployed (down 66,000 in a year and down 0.6% at 9.4%).

The Roy Morgan real unemployment figures are substantially higher than the current ABS estimate for January 2017 (5.7%);

In February the total Australian workforce was 13,348,000 (up 174,000 since February 2016) and total employment was 12,095,000 (up 240,000 in a year);

Full-time employment is 7,904,000 – up 87,000 from a year ago (7,817,000 in February 2016).

Part-time employment grew even more strongly, increasing by 153,000 to 4,191,000 from February 2016 (4,038,000);

Under-employment in February is now 8.5% (down 0.3% since February 2016) of the work force and 1,137,000 Australians (down 24,000 since February 2016) are under-employed.

Roy Morgan Unemployed and ‘Under-employed’* Estimate
Unemployed or ‘Under-employed’* Unemployed Unemployed looking for ‘Under-employed’*
Full-time Part-time
2015 ‘000 % ‘000 % ‘000 ‘000 ‘000 %
Jan-Mar 2015 2,384 18.9 1,327 10.5 656 672 1,057 8.4
Apr-Jun 2015 2,359 18.7 1,263 10.0 618 645 1,096 8.7
Jul-Sep 2015 2,061 16.2 1,109 8.7 518 591 952 7.5
Oct-Dec 2015 2,475 19.2 1,184 9.2 603 581 1,291 10.0
2016
Jan-Mar 2016 2,496 19.1 1,362 10.4 639 723 1,134 8.7
Apr-Jun 2016 2,322 18.1 1,317 10.2 637 680 1,005 7.8
Jul-Sep 2016 2,296 17.8 1,266 9.8 574 692 1,030 8.0
Oct-Dec 2016 2,446 18.9 1,191 9.2 635 556 1,255 9.7
Months
January 2016 2,575 19.7 1,346 10.3 696 650 1,229 9.4
February 2016 2,480 18.8 1,319 10.0 589 730 1,161 8.8
March 2016 2,433 18.8 1,422 11.0 631 791 1,011 7.8
April 2016 2,322 18.1 1,334 10.4 611 723 988 7.7
May 2016 2,316 18.1 1,369 10.7 661 708 947 7.4
June 2016 2,326 17.9 1,247 9.6 637 610 1,079 8.3
July 2016 2,536 19.5 1,365 10.5 645 720 1,171 9.0
August 2016 2,249 17.5 1,332 10.4 544 788 917 7.1
September 2016 2,103 16.2 1,101 8.5 532 569 1,002 7.7
October 2016 2,454 19.1 1,188 9.2 626 562 1,266 9.9
November 2016 2,299 17.6 1,199 9.2 629 570 1,100 8.4
December 2016 2,584 20.0 1,186 9.2 650 536 1,398 10.8
January 2017 2,402 17.9 1,295 9.7 634 661 1,107 8.2
February 2017 2,390 17.9 1,253 9.4 576 677 1,137 8.5

*Workforce includes those employed and those looking for work – the unemployed.

Gary Morgan, Executive Chairman, Roy Morgan Research, says:

“Australian employment grew over the past year – now at 12,095,000 (up 240,000 since February 2016). The increase was powered by a large increase in part-time employment – up 153,000 to 4,191,000 although full-time employment also grew strongly – up 87,000 to 7,904,000. 

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“However, despite the employment growth Australian real unemployment is still far too high – now 9.4% (1.253 million, down 66,000 from a year ago) Australians are unemployed, and an additional 8.5% (1.137 million, down 24,000) are under-employed – a total of 2.390 million (17.9%) looking for work or looking for more work.

“The weekend’s WA State Election result should be a huge wake-up fall for the Federal Government about what happens when Governments fail to take the tough decisions and allow the economic situation to deteriorate without taking action.

“A recent Roy Morgan Research analysis of changes in unemployment and under-employment around the Australian States showed Western Australia (15.9%) was well under the Australian figure (16.6%) for total unemployment and under-employment late in 2015 but by late 2016 Western Australia (19.6%) was well above the Australian figure (17.6%).

“Over the year to late 2016 total unemployment and –under-employment in Western Australia had increased by 3.7% as the mining boom came to an end and the Barnett Government failed to provide continuing employment to many laid off workers. The WA State Election saw a record swing of over 15% against the Liberal Government of Colin Barnett and a massive victory to the ALP. job employment australia

“The ALP is predicted to win up to 40 seats (up 19) in the 59 seat WA Parliament while the Liberals may win as few as a dozen – down from 31 seats won at the previous 2013 WA Election. Former WA Premier Colin Barnett’s failure to make the reforms to increase employment opportunities in WA for newly unemployed and under-employed workers was the key reason WA electors didn’t trust Barnett to manage the WA economy for growth, and new jobs, over the next four years.

“The result in WA is a clear message to Prime Minister Malcolm Turnbull to push ahead and enact the key reforms to get the Australian economy moving again and creating new jobs – reducing red tape in industry including supporting the recent Fair Work Commission decision to cut weekend and public holiday penalty rates, tackling the large cash economy that drains money from more productive uses, and implementing the promised company tax cuts are all vital reforms the Turnbull Government must support that will help reduce Australia’s high real unemployment and under-employment.

“Failure to carry out the reforms the Australian economy and Australian workers, need to prosper will mean Turnbull has no chance of re-election at the next Federal Election and also that the poor recent polling numbers for the Government will continue indefinitely.”

This Roy Morgan survey on Australia’s unemployment and ‘under-employed’* is based on weekly face-to-face interviews of 521,820 Australians aged 14 and over between January 2007 – February 2017 and includes 3,976 face-to-face interviews in February 2017.

*The ‘under-employed’ are those people who are in part-time work or consultants who are looking for more work. (Unfortunately the ABS does not release this figure in their monthly unemployment survey results).



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Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and his opinions are regularly featured in the media. Visit Metropole.com.au


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