Rise in unemployment positive sign, say business groups

However, they said the government needs to stick to its commitment from the Jobs and Skills Summit about increasing the levels of skilled migration to ensure the tight labour market does not continue to impact businesses.

“The continued trend of low unemployment remains a challenge for businesses trying to find staff,” said Australian Chamber of Commerce and Industry chief executive Andrew McKellar.

“Short-term fixes including addressing visa processing times and increased permanent migration levels are a good start, but we must enact longer-term reforms to ensure Australia has the workers it needs.”

The labour force figures from the Australian Bureau of Statistics show the number of people employed is up by 33,500 and the number of underemployed is down. 

The overall result in South Australia (3.9 per cent) and Queensland (3.2 per cent) are particularly encouraging, with both recording their lowest unemployment rates since records began in 1978. 

However, Tony Burke, Minister for Employment and Workplace Relations, said the economic circumstances should be resulting in stronger wages growth. 

“These results once again demonstrate why we need to update the workplace system and close the loopholes that are undermining wages growth,” he said. 

“As the Jobs Summit made clear, our nation needs to do a better job at reducing barriers to employment so that all Australians have the opportunity to participate to their full potential — in secure and safe work, with decent wages.”

Mr McKellar said the extra 33,500 people employed shows the economy is still running hot, with the labour market remaining tight.

“Importantly, full-time employment increased by 58,800 in August, while the number of part-time workers fell by 25,300. Underemployment has also decreased,” he said.

“This is a clear sign that, in this tight labour market, more Australians have a secure income.

“Youth unemployment is 3.2 points lower than in March 2020, showing more young people are finding work, delivering long-term benefits.”

Innes Willox, chief executive of the national employer association Ai Group, said that contrary to the views of the doomsayers, the ABS labour force data point once again to the strong recovery of the Australian labour market.

“The data is good news for those looking for work and continues a run of positive labour market numbers. This should be welcomed by the government and by unions,” he said.

“While unemployment was up by 14,000 in the month, this was driven by more people entering the workforce as shown by the increase in the participation rate to 64.3 per cent. This is fractionally below the record level of 64.4 per cent set in June this year.

“Over the year unemployment has fallen by 132,500 and the rate of unemployment at 3.5 per cent is considerably lower than the 4.6 per cent recorded a year ago. Underemployment is also lower with the 5.9 per cent rate last month comparing very favourably to the 9.3 per cent recorded a year ago.

“While much of the fall in underemployment over the year is due to people converting from part-time to full-time employment, a distinct proportion is also due to the increase in the number of people with second jobs. Ai Group estimates that well over 10 per cent of the fall in underemployment has been facilitated by the take up of second jobs. This also boosts household incomes.”