Australian underemployment is the highest in modern times
Underemployment is at its highest level since records began in the 1970s, but you won’t have heard it on the TV.
Thursday’s headlines were instead dominated by news that Australia’s official unemployment rate had fallen from 5.7 per cent in April to a four-year low of 5.5 per cent in May, based on the popular ‘seasonally adjusted’ measure.
Economists and politicians seized on this unexpected surge in full-time employment as a sign that the labour market and the broader economy were improving.
“Fifty-thousand Australians went out to get a job in May and they got one under the economic policies of the Turnbull government,” Treasurer Scott Morrison told Parliament.
“The unemployment rate now has fallen to 5.5 per cent, lower than what we inherited from the Labor Party back in 2013.”
Mr Morrison was using the seasonally adjusted measure, the usual number quoted by politicians and journalists.
However, the measure preferred by the Australian Bureau of Statistics – trend – had the unemployment rate unchanged at 5.7 per cent.
Worse still, the ABS itself drew special attention to the fact that the share of workers wanting more hours was at the highest level since modern records began in 1978. This was widely ignored.
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