Australia Employment Change

The Australian Bureau of Statistics compiles its Labour Force release from a rotating household survey. Each month one-eighth of the sampled dwellings is replaced, so any household stays in the sample for eight months, and that overlap is what allows the bureau to estimate monthly changes with some reliability. The release reports the net change in employed persons, split between full- and part-time, together with the unemployment rate, participation and hours worked.

Employment is one half of the Reserve Bank of Australia's mandate, which makes the survey a direct input to its decisions. The unemployment rate has usually carried more weight than the jobs number itself, since the bank frames its thinking around whether the labour market is operating above or below full employment. A reading that departs noticeably from expectations has historically tended to move the Australian dollar and short-dated government bond yields within seconds of the late-morning release.

Headlines can mislead. The ABS publishes both seasonally adjusted and trend series, and it emphasises that the monthly changes in the adjusted figures carry wide sampling errors. Sample rotation can produce swings when a new group of households differs from the one it replaced. Shifts in when new starters begin work around the summer holidays have also caused seasonal patterns to change, complicating the early-year readings.

Hours worked has become a closely followed companion, since it sometimes moves differently from headcount. The quarterly wage price index offers a slower read on labour costs.