CANBERRA — The Reserve Bank of Australia raised its cash rate to 4.60 percent on September 29, citing capacity pressures and an energy price shock. Sixteen days later the statistics office delivered a labour market that looks looser, and told readers to handle it with care.
Employment fell by 39,300 to 14,782,700 in seasonally adjusted terms, the Australian Bureau of Statistics (ABS) said on Thursday, as part-time jobs dropped by 73,700 and full-time jobs rose by 34,400. The unemployment rate was 4.7 percent, with 732,000 people out of work, and participation slipped 0.2 points to 66.8 percent. The figures landed while Treasurer Jim Chalmers, whose 2026 budget TEH covered in May, was in Bangkok for the IMF and G20 meetings.
The stake is the Reserve Bank’s next decision, due on November 3 after a two-day board meeting. Whether one soft month moves it depends on how far the data can be trusted, and the people who produced it are not sure.
The ABS said the September estimate may carry a small residual effect from changes to how it collects its supplementary survey, and it recommended the trend series, which held at 4.6 percent. Its own tables show the noise. The rotation group that left the sample after August had an unemployment rate of 3.5 percent; the group that entered in September stood at 4.6. Sean Crick, the bureau’s head of labour statistics, said “a higher proportion of people remained unemployed compared to recent years” this September, after an August in which more people who had been outside the labour force moved into unemployment.
The weakness was uneven. In New South Wales, seasonally adjusted employment fell 0.8 percent and unemployment rose 0.4 points to 4.7 percent. Tasmania lost 0.7 percent of its jobs, while Western Australia gained 1.3 percent and South Australia’s rate fell half a point to 4.2 percent. Victoria and Tasmania carry the highest trend rates, at 5.1 and 5.2 percent, and in Victoria the ABS reweighted about 1,400 respondents, roughly 2.8 percent of the September sample, in one rotation group.
The Reserve Bank’s own reading of the labour market was already unsettled. Minutes of the board’s September meeting record members noting that “considerable caution is warranted when interpreting the current official labour force data” because of the survey changes, and staff “increasingly questioning whether the rate of unemployment that is consistent with the inflation target was higher than previously assessed”, which would mean more pressure on capacity than the board had assumed. The minutes put August unemployment at 4.6 percent. The ABS’s latest table lists both August and September at 4.7 percent, with the unrounded rise at 0.1 points.
Ashwin Clarke, a senior economist at Commonwealth Bank of Australia (CommBank), called the result “weaker than both we and the market expected”, against a consensus for a 20,000 gain, yet consistent with a labour market “gradually loosening in response to earlier interest rate hikes and higher fuel prices”. CommBank wrote that it still expects a hold in November, but Clarke said, “The risks remain firmly tilted to the upside and another hike is plausible.” He added that the Reserve Bank was likely to give this month’s figures less weight than usual. Deputy Governor Andrew Hauser speaks on October 21, and quarterly inflation figures are due on October 28.
Chalmers’s office put out a joint release with UK Chancellor John Healey from Bangkok on Thursday, and it does not mention the jobs figures; TEH found no separate statement from the Treasurer on them among his media releases at the time of writing. What it does name is the shared cause. “Nobody is protected from these energy shocks driving up fuel prices, inflation and interest rates around the world,” the release says, adding that a reopening of the Strait of Hormuz is “urgent and essential”. The IMF Hormuz forecast TEH reported on Tuesday assumes the strait will not reopen until March 2027.
The documents leave one number unsaid. The minutes describe unemployment as close to the board’s assessment of full employment and suggest the true threshold may be higher, but neither they nor the board’s statement name the rate at which the labour market would count as loose enough.
