Australia's unemployment rate rose to 4.3% in June, up from 4.1% in May, according to data released Thursday by the Australian Bureau of Statistics (ABS), strengthening expectations of a rate cut by the Reserve Bank of Australia.
The figures come after the RBA held interest rates steady last week, surprising markets.
As of 16 July, the ASX’s RBA Rate Tracker is pricing in a 91% expectation of an interest rate decrease to 3.60% at the next Reserve Bank of Australia (RBA) Board meeting.
Sean Crick, ABS head of labour statistics, said: “This month we saw the unemployment rate rise 0.2 percentage points, driven by a 34,000 increase in the number of unemployed people.”
Employment increased by just 2,000 people in June, following a fall of 1,000 in May and coming in well below expectations of 20,000. Compared to June 2024, total employment was up 2.0%.
The modest gain was driven by a 40,000 rise in part-time jobs, which was offset by a 38,000 decline in full-time employment.
The employment-to-population ratio held steady at 64.2%, while the participation rate edged up to 67.1%.
Total hours worked fell 0.9% in June, following a 1.4% increase in May.
“This month we saw a decrease in full-time hours worked, down 1.3%, associated with a 0.4% fall in full-time employees,” Mr Crick added.
The underemployment rate rose by 0.1 percentage points to 6.0% in June. Despite the monthly rise, it remains 0.4 points lower than June 2024 and 2.7 points below its March 2020 level.
The broader underutilisation rate, which combines unemployment and underemployment, increased by 0.3 percentage points to 10.3%. That figure is 0.1 percentage point lower than June 2024 and 3.6 points below its pre-pandemic peak in March 2020.
The rise in joblessness and reduced full-time hours point to growing slack in the labour market and reinforce expectations that monetary policy will ease in coming months.
The Australian dollar slipped to weekly lows following the data, falling 0.5% to 0.64944 against the United States dollar.
