Australian Worker Participation Increases as Lockdowns Ease

In BICSI Blog, BICSI Bytes, Featured, News by

According to the Australian Bureau of Statistics (ABS), Australia’s seasonally adjusted employment fell by 46,000 people (0.4%) in October 2021, while participation increased (0.1 percentage points).

Bjorn Jarvis, head of labour statistics at ABS, said the latest data covered the period from 26 September to 9 October 2021. This included school holidays and some early changes to restrictions associated with the Delta lockdowns, particularly in NSW, ahead of larger changes from mid-October, stating: “As we’ve seen throughout the pandemic, changes in the labour markets with lockdowns continued to have a large influence on the national figures.

“There was early recovery in NSW, with their participation rate increasing by 0.8 percentage points in October. This was underpinned by increases in both employment (22,000) and unemployment (35,000), with their labour force increasing by around 57,000 people. However, it was still 218,000 people lower than in May.

“In contrast, while Victoria’s unemployment also increased by 29,000 people, employment fell by a further 50,000, with their participation rate falling by 0.4 percentage points. The Victorian labour force was 113,000 people lower than in May.”

Employment, unemployment and participation

The national participation rate increased by 0.1 percentage points to 64.7% in October, but was 1.6 percentage points below May.

This was the first increase in participation rate since June 2021, reflecting a large increase in unemployment (82,000 people). The large increase in unemployment and fall in employment saw the unemployment rate increase by 0.6 percentage points to 5.2% in October 2021, around where it had been before the Delta variant outbreaks.

“The increases in unemployment show that people were preparing to get back to work, and increasingly available and actively looking for work – particularly in NSW, Victoria and ACT,” Jarvis continued. “This follows what we have seen towards the end of other major lockdowns, including the one in Victoria late last year.

“It may seem counterintuitive for unemployment to rise as conditions are about to improve. However, this shows how unusual lockdowns are, compared with other economic shocks, in how they limit being able to work and look for work.”

The relatively large increases in unemployment in these three jurisdictions resulted in large increases in their unemployment rates, rising 0.8 percentage points in NSW (to 5.4%), 0.9 percentage points in Victoria (to 5.6%) and 2.5 percentage points in ACT (to 6.6%). Unemployment also increased in Queensland, SA and Tasmania, but fell in WA and NT.

Hours worked decreased 0.1% in October, a slight decline from the 0.9% rise in September. This was underpinned by a further fall in hours in Victoria (4.0%) and increases in NSW (3.9%) and ACT (3.1%).

Hours worked in NSW continued to recover, increasing by 3.9% in October, following the 2.7% rise in September. This was underpinned by increases in people working full-time hours as well as a further recovery among people who had been working reduced hours, though hours worked remained 7.2% below the start of lockdown.

“In Victoria, hours worked continued to decline more than employment (4.0%, compared with 1.5%).  This highlights the extent to which Victorians had reduced hours or no work through October, without necessarily losing their jobs.”

In the Australian Capital Territory, hours worked increased 3.1% in October, recovering part of the large fall in September (10.5%).

However, the changes in hours worked partly reflected changes in the patterns of people taking leave during the school holidays.

“Fewer people in New South Wales, Victoria and the Australian Capital Territory took leave during the school holidays – during the lockdown – particularly people who work full-time. This is something that we have seen throughout the pandemic, with some people working more hours than usual during holiday periods, in addition to the large numbers of people working less than usual,” Jarvis said.

Across the other five states and territories changes in hours worked ranged between an increase of 1.0% in Northern Territory to a 1.5% fall in South Australia. Some of the combined fall in hours worked across these jurisdictions reflected more people than usual taking leave during the school holidays, in contrast to the reduced leave taken in the jurisdictions in lockdown.

The national underemployment rate increased by 0.3 percentage points to 9.5% in October 2021. The underemployment rate continued to increase in Victoria (up 1.3 percentage points to 11.3%), rose slightly in New South Wales to 10.6% and declined in most other states and territories.

Today’s release includes additional analysis of hours worked, including people working zero hours, and an analysis of employment and hours worked at the state and territory level. An additional spotlight on job attachment is also included in today’s release.

The October survey reference period was 26 September to 9 October 2021. The November survey reference period was 31 October to 13 November 2021.