Australia has achieved a record-equalling 15th consecutive month of increasing job numbers and economists have given glowing assessments of the labour market despite an increase in the unemployment rate to 5.5 per cent.
The number of people in work rose by 34,700 in December, according to Australian Bureau of Statistics data – well above expectations of 15,000 new jobs in the month.
Full-time employment rose by 15,100 jobs, while part-time positions increased by 19,500.
The unemployment edged higher from 5.4 per cent in November to 5.5 per cent in a surprise result, however ANZ economist Felicity Emmett noted the increase was accompanied by a 0.2 per cent rise in the participation rate to 65.7 per cent – the second-highest level on record for people working or looking for work.
“The labour market clearly remains in great shape,” Ms Emmett said.
“Both male and female participation rose solidly, with female participation hitting a fresh record high.”
Since December 2016, more than 400,000 positions have been created, three quarters of them full-time jobs.
CommSec chief economist Craig James said December’s record-equalling run of job gains has matched the rise achieved between May 1993 and July 1994.
“The Australian jobs market is going gangbusters,” Mr James said.
Prime Minister Malcolm Turnbull praised the outcome from Japan where he is discussing trade with his Japanese counterpart Shinzo Abe.
“The participation rate is at the highest level in seven years, and we’ve seen already consumer confidence at the highest level since November, 2013,” Mr Turnbull said.
However TD Securities chief Asia-Pacific macro strategist Annette Beacher said both wages and inflation remained weak despite the relative boom in employment
“Wages growth should follow such a prolonged outsized employment growth, in turn boosting core CPI… but at least wages and underlying inflation are both off the floor and rising,” Ms Beacher said.
JP Morgan analyst Ben Jarman said the unemployment rate would remain relatively unchanged until the economy hits above trend growth.
“Given below-trend growth and the particular drivers of employment and participation, we do not expect the labour market to tighten, with unemployment to average 5.5 per cent to 5.75 per cent”, Mr Jarman said.