By James Glynn
SYDNEY – Australia’s unemployment rate fell to 4.0% in February, its lowest level since August 2008, bringing the economy closer to full employment and fueling calls for the central bank to raise interest rates for the first time since 2010.
The economy added 77,400 new jobs in February, well above the expected increase of 37,000, the Australian Bureau of Statistics said on Thursday. Full-time employment jumped 121,900 during the month.
“This is the lowest unemployment rate since August 2008 and only the third time in the history of the monthly survey that unemployment was as low as 4.0%,” the ABS said. Any further decline in unemployment will bring it down to levels not seen since 1974. The jobless rate was 4.2% in January.
The further tightening in the labor market will encourage bets that the RBA will raise interest rates by mid-year, forced to act by rising inflation and accelerating economic growth. ‘use.
Yet RBA Governor Philip Lowe only admitted that an interest hike was “plausible” this year. He stressed the need for patience as wage growth remains weak and inflation is not yet entrenched with the desired target range of 2-3%.
The data also confirms that the Omicron variant of the Covid-19 virus did not derail Australia’s economic recovery when it peaked in December and January. This reinforces the predictions of many economists that the economy will grow rapidly in 2022.
Employment rose for the fourth consecutive month in February and was around 202,000 more than the pre-Delta peak of June 2021, the ABS said.
Write to James Glynn at [email protected]
