Unemployment increases to 5.3%, but expert says underemployment still a problem

The unemployment rate has increased by a seasonally adjusted 0.1% to 5.3% following a decrease in January of 0.2%, the latest figures from the Australian Bureau of Statistics have revealed.

The announcement comes as an industry expert has said the results do not necessarily reflect an accurate picture of the economy, with the number of underemployed Australians requiring more attention.

The ABS figures show employment increased overall by 400 to 10,971,100. Full-time employment increased by 11,400 to 7,659,700, while part-time employment decreased by 11,000 to 3,311,400.

The male unemployment rate increased by 0.2 percentage points to 5.4%, while the female unemployment rate decreased by 0.1 points to 4.2%. The participation rate decreased by 0.1 points to 65.2%.

The aggregate of monthly hours worked increased by 2.4%, or 35.9 million hours, to 1,533.2 million.

The actual unemployment rate increased to 5.3% from the downwardly revised 5.2% from January. The number of employed persons has increased by 10,700 to 615,900, while the seasonally adjusted labour force underutilisation rate was 12.8%, down by 0.6%.

It is this figure that is sited by Peter Gleeson, general manager of professional and executive recruitment for Chandler Macleod, as evidence the labour market is still trying to recover.

He claims the underemployed, defined as part-time workers who want to work in full-time positions but cannot find enough work, are the key issue here and that more full-time work is needed.

“The number that came out today shows 11,000 full-time jobs have been created, and that 11,000 part-time jobs have evaporated. My interpretation is that these part-time workers have been working at these jobs for quite some time, and employers are now finding they want to retain them.”

“It does actually improve the underemployed, but the reality is we still have about 12% of the workforce quoted at underemployment which means a heck a lot of the market is underutilised.”

Gleeson says this trend has been occurring since June 2008, and that until the underutilisation rate starts to decrease by large amounts the economy will not see massive growth.

“Ideally we wouldn’t have anyone underemployed, but we know there will be people in that situation. The closer to 0% the better, but who knows whether we can achieve that, so the closer we get to that point the better off the economy will be.”