I repeatedly warn towards utilizing the observations from one month to inform a narrative on condition that the information jumps round quite a bit at this frequency over time. It’s clear that there’s a lot of month-to-month variation within the knowledge at current. The Australian Bureau of Statistics (ABS) launched the most recent labour pressure knowledge at the moment (September 18, 2025) – Labour Power, Australia – for August 2025, which reveals that the slowdown that has been signalled for some months and was interrupted by final month’s stronger consequence seems to have reasserted itself. Employment fell general as did the participation, which saved the unemployment price from rising. With out the autumn within the participation price, the official unemployment price would have been 4.4 per cent (rounded) fairly than its present official worth of 4.2 per cent. Meaning some staff are prone to have moved into hidden unemployment (exterior the labor pressure) as job alternatives have stalled. Underemploymentfell 0.1 level, which was stunning given the numerous lack of full-time employment. I count on a revision to this consequence subsequent month. It stays a proven fact that with 9.9 per cent of accessible labour not getting used it’s ludicrous to speak about Australia being near full employment. There may be substantial scope for extra job creation given the slack that’s current.
The abstract seasonally-adjusted statistics for August 2025 are:
- Employment fell 5.4 thousand (-0.04 per cent).
- Full-time employment fell 40.9 thousand (-0.4 per cent).
- Half-time employment rose 35.5 thousand (0.8 per cent).
- Unemployment fell 0.9 thousand (0 per cent) to 647,400.
- The unemployment price was regular at 4.2 per cent.
- The participation price fell 0.2 factors to 66.8 per cent.
- The Employment-population ratio fell 0.1 level to 64 per cent.
- Month-to-month hours labored fell 8 million (-0.4 per cent).
- Underemployment fell 0.1 level to five.7 per cent (falling 22.2 thousand to 871.1 thousand).
- The Broad Labour Underutilisation price (the sum of unemployment and underemployment) fell 0.1 factors to 9.9 per cent.
- Total, there are 1518.53 thousand individuals both unemployed or underemployed.
The ABS press launch – UUnemployment price regular at 4.2% – famous that:
The seasonally adjusted unemployment price was regular at 4.2 per cent in August …
Employment fell by 5,000 individuals and the variety of unemployed fell by 1,000 individuals in August …
This meant that the unemployment price remained regular at 4.2 per cent while the participation price fell by 0.1 share factors to 66.8 per cent …
The employment-to-population ratio fell by 0.1 share factors to 64.0 per cent.
A fall in full-time employment (-41,000 individuals) drove the general drop in employment numbers. In the meantime, part-time employment noticed a 36,000 particular person rise …
Hours labored fell 0.4 per cent in August, supported by much less individuals working full-time hours this month …
The underutilisation price, which mixes the unemployment and underemployment charges, fell by 0.1 share factors to 9.9 per cent. This was 0.7 share factors decrease than August 2024, and 4.0 share factors decrease than March 2020.
Abstract
1. Simply as final month’s knowledge represented a slight reversal on the deteriorating end result from June, this month’s knowledge reverse that outlook.
2. There may be nonetheless a downward bias away from full-time employment, which suggests a pattern weakening.
3. There may be now 9.9 per cent of the obtainable and prepared labour provide being wasted.
Employment development detrimental in August
- Employment fell 5.4 thousand (-0.04 per cent).
- Full-time employment fell 40.9 thousand (-0.4 per cent).
- Half-time employment rose 35.5 thousand (0.8 per cent).
The next graph exhibits the expansion in complete, full-time, and part-time employment for the final 24 months.
The next desk exhibits the shifts over the past 6 months which helps to see the underlying pattern.
The Employment-to-Inhabitants ratio supplies a measure of the state of the labour market that’s impartial of the provision shifts within the labour market (pushed by the shifts within the participation price).
The underlying working age inhabitants grows steadily whereas the labour pressure shifts with each underlying inhabitants development and the participation swings.
The next graph exhibits the Employment-Inhabitants ratio was regular at 64.2 – which supplies some counter to the opposite variables which might be indicating a scientific slowdown is underway.
The subsequent graphs present the common month-to-month change in complete employment (first graph) and full- and part-time employment (second graph).
For complete employment the month-to-month common adjustments had been:
- 2022 – 44.8 thousand
- 2023 – 30.8 thousand
- 2024 – 32.6 thousand
- 2025 to date – 15.5 thousand
Month-to-month hours labored fell 8 million (-0.4 per cent) in August 2025
A reversal from final month.
The next graph exhibits the expansion in month-to-month hours labored for the final 24 months, with the straight line being a easy linear regression to point pattern.
Unemployment fell 0.9 thousand (-0.1 per cent) to 647,400 in August
The small decline in official unemployment (these staff categorised as looking for work) was offset by the rise in hidden unemployment because the participation price fell within the wake of declining job alternatives.
The next graph exhibits the evolution of the official unemployment price since 1980.
What was the impression of the declining participation price on unemployment in August 2025
The query is what would the unemployment price have been, given the employment decline in August, if the participation price had not additionally fallen?
These ideas assist us reply one of these query:
- The labour pressure is a subset of the working-age inhabitants (these above 15 years previous). The proportion of the working-age inhabitants that constitutes the labour pressure is known as the labour pressure participation price. Thus adjustments within the labour pressure can impression on the official unemployment price, and, consequently, actions within the latter should be interpreted fastidiously. A rising unemployment price might not point out a recessing economic system.
- The labour pressure can increase because of basic inhabitants development and/or will increase within the labour pressure participation charges (and vice versa).
The next Desk exhibits the breakdown within the adjustments to the principle aggregates (Labour Power, Employment and Unemployment) and the impression of the autumn within the participation price.
The change within the labour pressure in August 2025 was the result of two separate components:
- The underlying inhabitants development added 37.9 thousand individuals to the labour pressure. The inhabitants development impression on the labour pressure mixture is comparatively regular from month to month; and
- The autumn within the participation price meant that there have been 31.6 thousand LESS staff within the labour pressure (relative to what would have occurred had the participation price remained unchanged).
- The online consequence was that the labour pressure fell by 6.3 thousand.
Evaluation:
1. If the participation price had not have fallen in August 2025, complete unemployment, given the present employment stage, would have been 679 thousand fairly than the official depend of 647.4 thousand as recorded by the ABS – a distinction of 31.6 thousand staff (the ‘participation impact’).
2. With out the autumn within the participation price, the official unemployment price would have been 4.4 per cent (rounded) fairly than its present official worth of 4.2 per cent.
Broad labour underutilisation – down 0.1 level in August
- Underemployment fell 0.1 level to five.7 per cent (falling 22.2 thousand to 871.1 thousand).
- The Broad Labour Underutilisation price (the sum of unemployment and underemployment) fell 0.1 factors to 9.9 per cent.
- Total, there are 1518.53 thousand individuals both unemployed or underemployed.
The next graph exhibits the evolution of underemployment and the Broad labour underutilisation price since 1980.
Teenage labour market – deteriorates
- Complete teenage (15-19) employment fell 14.6 thousand (-1.7 per cent) in August 2025.
- Full-time employment fell 5.3 thousand (-2.7 per cent).
- Half-time employment fell 9.4 thousand (-1.4 per cent).
The next desk summarises the shifts within the teenage labour marketplace for the month and over the past 12 months.
To place these adjustments right into a scale perspective (that’s, relative to measurement of the teenage labour pressure) the next graph exhibits the shifts within the Employment-Inhabitants ratio for youngsters.
The Teenage Employment-Inhabitants ratios and their month-to-month adjustments in August 2025 had been:
- Males: 47 per cent – down 0.2 factors.
- Females: 51.9 per cent – down 1.7 factors.
- Complete: 49.4 per cent – down 1 level.
Conclusion
My customary warning to take care in deciphering month-to-month labour pressure adjustments – they will fluctuate for various causes and it’s imprudent to leap to conclusions on the again of a single month’s knowledge.
- The slowdown that has been signalled for some months and was interrupted by final month’s stronger consequence seems to have reasserted itself.
- Employment fell general as did the participation, which saved the unemployment price from rising.
- Meaning some staff are prone to have moved into hidden unemployment (exterior the labor pressure) as job alternatives have stalled.
- Underemployment fell 0.1 level, which was stunning given the numerous lack of full-time employment. I count on a revision to this consequence subsequent month.
- It stays a proven fact that with 9.9 per cent of accessible labour not getting used it’s ludicrous to speak about Australia being near full employment. There may be substantial scope for extra job creation given the slack that’s current.
That’s sufficient for at the moment!
(c) Copyright 2025 William Mitchell. All Rights Reserved.