Australian real unemployment steady at 9.2% (1.186m) but under-employment up 2.4% to 10.8% (1.398m) – highest for a year

In December a total of 2.584 million Australians, 20% of the workforce, were either unemployed (1,186,000) or under-employed (1,398,000) - down 106,000 (down 0.7%) from December 2015.

• Unemployment is less than a year ago with 1.186 million Australians now unemployed (down 70,000 in a year and down 0.5% at 9.2%). However, these real unemployment figures are substantially higher than the current ABS figure for November 2016 (5.7%);
  
  
• In December the Australian workforce decreased to 12,892,000 (down 115,000 since December 2015) and total employment decreased to 11,706,000 (down 45,000);
  
  
• However the good news is that full-time employment is now 7,768,000 – up a strong 381,000 from a year ago (7,387,000 in December 2015). In contrast, part-time employment has decreased by 426,000 to 3,938,000 from the record high in December 2015 (4,364,000);
  
  
• The lower part-time employment contributed to the small fall in under-employment; now 10.8% of Australians 1,398,000 (down 36,000 since December 2015) are under-employed (down 0.2%).

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

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

“In December Australia’s real unemployment was unchanged at 9.2% (1.1186 million people looking for work, down 70,000 from a year ago) and under-employment was 10.8% (1.398 million, down 36,000 in a year) – a total of 20.0% (2.584 million) Australians looking for work or looking for more work – the highest overall figure since December 2015.

“Total unemployment, and especially under-employment, traditionally rises in the last month of the year as school-leavers join the workforce looking for any work they can get over the Summer period before University starts in March and retailers take on extra part-time staff for the Christmas-New Year’s sales period – which leads to a significant increase in under-employment.

“Australia’s total unemployment and under-employment has now been above 2 million for 15 straight months stretching back into late 2015 and illustrates the weakness in the Australian economy that official unemployment statistics under-report.

“While commentators refer to the strength of the economy because of the misleading  ‘low’ unemployment levels the most recent Australian GDP figures released in December provide a more sobering view with Australian GDP shrinking 0.5% in the September quarter 2015 – the first contraction in Australian GDP for over five years since 2011.

“The challenges facing the Australian economy in 2017 are well known with Hazelwood power station in Victoria due to close down in April, the continuing questions about the Alcoa smelter in Portland, the Arrium iron ore and steel business and the Australian car industry closing down later in the year all set to trigger thousands of job losses. These challenges face Australia as our most important ally prepares to inaugurate President-elect Donald Trump this Friday.

“The world will be watching as Donald Trump, who has continually called out the high levels of unemployment in the US (over 20% according to Trump during the campaign) seeks to do whatever it takes to get American workers jobs again.”

This Roy Morgan survey on Australia’s unemployment and ‘under-employed’* is based on weekly face-to-face interviews of 513,891 Australians aged 14 and over between January 2007 – December 2016 and includes 3,110 face-to-face interviews in December 2016.

*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).

For further information: 

Unemployment Data Tables

Roy Morgan Research Employment Estimates (2001-2016)

Roy Morgan Research Unemployment & Under-employment Estimates (2007-2016)

Roy Morgan Research vs ABS Employment Estimates (1992-2016)

ABS Employment Estimates (1992-2016)

ROY MORGAN MEASURES REAL UNEMPLOYMENT IN AUSTRALIA

http://www.roymorgan.com/~/media/Files/Papers/2012/20120603.pdf

The Roy Morgan Unemployment estimate is obtained by surveying an Australia-wide cross section by face-to-face interviews. A person is classified as unemployed if they are looking for work, no matter when.

The results are not seasonally adjusted and provide an accurate measure of monthly unemployment estimates in Australia.

The Australian Bureau of Statistics Unemployment estimates are obtained by mostly telephone interviews. Households selected for the ABS Survey are interviewed each month for eight months, with one-eighth of the sample being replaced each month. The first interview is conducted face-to-face. Subsequent interviews are then conducted by telephone.

The ABS classifies a person as unemployed if, when surveyed, they have been actively looking for work in the four weeks up to the end of the reference week and if they were available for work in the reference week.

The Australian Bureau of Statistics Unemployment estimates are also seasonally adjusted.

For these reasons the Australian Bureau of Statistics Unemployment estimates are different from the Roy Morgan Unemployment estimate. Gary Morgan's concerns regarding the ABS Unemployment estimate is clearly outlined in his letter to the Australian Financial Review, which was not published.

Margin of Error

The margin of error to be allowed for in any estimate depends mainly on the number of interviews on which it is based. The following table gives indications of the likely range within which estimates would be 95% likely to fall, expressed as the number of percentage points above or below the actual estimate. The figures are approximate and for general guidance only, and assume a simple random sample. Allowance for design effects (such as stratification and weighting) should be made as appropriate.