Australia's employment probably back to uptrend, but hours worked easing after Q1 surge

April's corrective decline in Australia's employment was mild at -3K jobs (equivalent to a monthly annualised decline of 0.3%) considering the strength of employment growth over the previous six months (2.8% annualized). Hence, although a return to payroll expansion is ecpected, the risks to the forecast are probably skewed to the downside. That said, even though employment growth has gathered pace over the past year while GDP growth has slowed, Societe Generale believes, the chances of quite solid employment growth persisting are good, reflecting the relatively greater labour-intensity of the current growth drivers - private consumption, services exports, residential construction - compared with resource investment. 


According to Societe Generale, the risks to the forecast for an unchanged unemployment rate at 6.2% are more balanced, given that the unemployment rate stood at an unrounded 6.16% in April, and that the labour force expanded strongly over the past half year (though not in April). Looking beyond monthly fluctuations, the unemployment rate has been effectively flat for the past 10 months.