Recently released figures from the Australian Bureau of Statistics (ABS) has shown that Australia’s unemployment rate is continuing to fall. The latest data shows the unemployment rate dropping 0.4 percent points to 5.1 percent during the month of May 2021.
The figures published by the ABS revealed that approximately 115,000 Australians found new positions of employment between April and May 2021. This has radically decreased the unemployment rate across the country.
Australia’s current rate of unemployment is now the same as it was in February 2020, just before the occurrence of the economic damage that was inflicted by the covid-19 pandemic.
The figures for the month of May 2021 was the seventh consecutive monthly fall in Australia’s unemployment rate.
Australia’s unemployment rate fell to 5.1 percent, which was below March 2020 rate of 5.3 per cent and back to the level in February 2020 of 5.1 per cent. The declining unemployment rate continues to align with the strong increases in job vacancies.
The number of unemployed Australians decreased by 53,000 in May, down to 701,000. The number of unemployed people has fallen by around 303,000 since the peak of one million unemployed people during the month of July 2020.
The youth unemployment rate increased by 0.1 percentage points but it still remains low, it currently sits at 10.7 percent. The last time Australia had a youth unemployment rate as low as was it was recorded being for April and May 2021 was way back in January 2009.
Figures released by the ABS revealed that the number of employed women increased by 69,000 in May, and the number of men increased by 46,000 during the same period of time.
Employment for Australian females was 1.6 percent above the start of the pandemic, this is compared with 0.5 percent for men.
This increase in female employment for the month of May means that a higher percentage of women were in paid work than ever before – 58.8 per cent, 0.7 percentage points higher than the start of the pandemic.
The difference was even more significant for women aged 15 to 64, whose employment-to-population ratio in May was 1.5 percentage points above March 2020. Australia’s unemployment rate peaked in July 2020 at 7.4 percent.
Underemployment in Australia
On the surface this might make people believe that the government is trying to manipulate the unemployment data to make the labour market appear in better shape than what it really is. But this is not the case, as the data that is gathered is broken down into different types of jobs. Full-time, part-time or casual.
Once the ABS is aware you have a job, they will ask you if you are happy with the number of hours you’re currently working or if you would like to work more hours. If you are wanting to work more hours, the ABS will record you as someone who is “underemployed”.
An Australian worker is only “fully employed” if they are satisfied with the currently number of hours they are working and don’t want any more.
This means that someone who is only working one hour a week can be considered be fully employed.
It is also important to be aware that the definition of an employed as working “one or more hour a week” is a definition that was not created by the ABS.
It is a definition internationally recognised by the International Labour Origanisation (ILO), an agency run by the United Nations.
This organisation has been operating for a number of decades and the ILO consists of 187-member countries who all use the same definition of “employed” when gathering data about their countries labour force and employment statistics. By having the same definition for 187 it makes it easier for Australia to accurately compare their employment statistics to the workforce of other countries around the world.
If you are in a position where you owned your own business, the revenue was pouring in and you only had to log onto your computer for one hour a week to check your accounts to ensure everything is running smoothly. Then you could go back to playing golf or whatever you enjoy doing when you have spare time.
Another common situation where someone might work one hour a week and consider themselves to be fully employed would be if your partner is working a full-time and therefore gives you regular income. However, you still work once a week to give your household a bit of extra money.
The team at C&D Restructure and Taxation Advisory are here to help. As part of the Vault Group we can offer the full suite of financial products and advice to help you navigate the business landscape. Schedule a meeting here via Calendly or give us a call on 07 36086800.
The team at C&D Restructure and Taxation Advisory are here to help. As part of the Vault Group we can offer the full suite of financial products and advice to help you navigate the business landscape. Schedule a meeting here via Calendly or give us a call on 1300 1 VAULT (1300 182 858)
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