Participation rate returns to record high in November: Australia

The seasonally adjusted participation rate rose to 66.8 per cent in November 2022, back to its record high in the middle of 2022, according to data released today by the Australian Bureau of Statistics (ABS).

Bjorn Jarvis, head of labour statistics at the ABS, said: “With increases in both employment (up 64,000 people) and unemployment (up 7,000 people), the unemployment rate remained steady at 3.4 per cent, while the participation rate increased to 66.8 per cent.”

“The participation rate increased by 0.2 percentage points to 66.8 per cent in November, returning to the record high we saw in June 2022. It was 1.0 percentage point higher than before the pandemic,” Mr Jarvis said.

The participation rate for women also returned to the historical high of June, rising 0.2 percentage points to 62.4 per cent. For men, the participation rate also rose 0.2 percentage points to 71.3 per cent.

“The record high participation rate continues to show that it is a tight labour market, especially when coupled with very low unemployment,” Mr Jarvis said.

• Source: Labour Force, Australia Table 1
• Large month-to-month changes occurred during the COVID-19 pandemic, resulting in multiple trend breaks. The ABS recommends caution when using trend estimates published in spreadsheets in this release for this period. Information on trend breaks can be found in Labour Force, Australia methodology, November 2022.

Seasonally adjusted employment increased by 64,000 people (0.5 per cent) in November 2022. In line with this, the employment to population ratio rose to a record high of 64.5 per cent.

“The employment growth in November is consistent with other labour market indicators showing continuing growth through 2022, such as payroll jobs data. Along with the continued strength in employment, hours worked are also well above pre-pandemic levels,” Mr Jarvis said.

Seasonally adjusted monthly hours worked decreased by 0.4 per cent in November, following a 2.4 per cent increase in October.

Despite the relatively strong growth in hours worked during 2022, there continued to be a higher than usual number of people working reduced hours due to illness.

“In November, we saw the number of people working reduced hours due to illness increasing by 50,000, back over half a million people (520,000), which is still around a third higher than we usually see at this time of the year,” Mr Jarvis said.

Source: Labour Force, Australia Tables 1 and 19

The seasonally adjusted underemployment rate fell 0.1 percentage point to 5.8 per cent, 2.9 percentage points below the pre-pandemic rate.

The underutilisation rate, which combines the unemployment and underemployment rates, fell 0.1 percentage point to 9.3 per cent in seasonally adjusted terms. This was 4.7 percentage points below March 2020, and the lowest rate since February 1982.

“The low underutilisation rate of 9.3 per cent in November 2022 reflects the fact that there are now around 221,000 fewer unemployed people and 370,000 fewer underemployed people than in March 2020. Unemployment and underemployment are both now around two-thirds of what they were,” Mr Jarvis said.

Trend employment increased by 33,000 people in November 2022 (0.2 per cent), and trend monthly hours worked increased 0.4 per cent. These reflected a continuation of the pace of growth in employment and hours worked seen during much of 2022.

Most of the recent net employment growth has been in full-time employment, resulting in a higher share of full-time employment than there was pre-pandemic.

“Around 68.3 per cent of employed people were full-time workers just prior to the pandemic, having generally trended down over the decades through to 2017. It has now increased to 69.7 per cent in November 2022 – around where it was close to a decade ago,” Mr Jarvis said.

• Source: Labour Force, Australia, Table 1
• Large month-to-month changes occurred during the COVID-19 pandemic, resulting in multiple trend breaks. The ABS recommends caution when using trend estimates published in spreadsheets in this release for this period. Information on trend breaks can be found in Labour Force, Australia methodology, November 2022.

The trend unemployment rate remained steady at 3.5 per cent and the underemployment rate remained steady at 5.9 per cent.

The trend participation rate remained steady at 66.7 per cent.

Today’s release includes an article on rebenchmarking of Labour Force estimates to revised population estimates, along with additional analysis of hours worked and historical charts back to 1966.