Bankwest Economic Update

Events Wanneroo Business | Monday, April 23, 2018

Economic Blog Update

 The facts and figures below are included in the latest update from Bankwest Chief Economist, Alan Langford, this time with a focus on unemployment and full time employment levels.

WA’s headline (ie seasonally adjusted) unemployment rate jumped from 6.1 per cent in February, to 6.9 per cent in March.  The steep rise in the headline jobless rate is a bit misleading, because the participation rate jumped sharply as well.

Nevertheless, the rise in the seasonally adjusted unemployment rate, coupled with annual re-analysis of seasonal factors, was enough to trigger a resumption of an uptick in the official trend jobless rate, which has now risen from 5.6 per cent in July last year, to 6.4 per cent, 0.8 of a percentage point above the national rate. Over the same period, WA’s trend participation rate has risen from 67.9 per cent, to 68.4 per cent - not enough to explain all of the rise in the jobless rate.

WA’s participation rate is the highest of all states, meaning the state’s economy has to generate faster employment growth to maintain the same jobless rate as states with lower participation rates.

But while it looked to be doing just that until about 9 months ago, the apparent ‘surge’ in full-time employment has now evaporated (Figure 1 in the attached graphical summary), if it was ever quite as robust as it seemed anyway.

That’s not to suggest that the recovery in the WA economy has stalled, but rather that it is one thing to generate strong full-time jobs growth when emerging from a very deep trough, but quite another to sustain it month after month, year in year out. The recovery in WA’s economy was always going to be stop-start rather than onwards and upwards, and so too will be the trajectory of full-time employment growth.

DOWNLOAD Graphical Summary


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