Australian Employment Preview: Solid pace in January

Tomorrow morning, we have the labour market data coming out of Australia at 0030 GMT. As we move closer to the release time, here are the expectations of banks from the upcoming employment data out of Australian economy.

Westpac

“Our Jobs Index has moderated but is still pointing to a solid pace of employment growth. The annual pace of job ads recently turned negative just as some of the business surveys showed weaker employment conditions. But the low level of unemployment expectations suggests we are facing a moderation in employment, not a correction."

"For January, +15k on employment, holding the participation rate flat, is enough to hold unemployment at 5.0%."

"It is also worth noting that 2018 produced a -0.2ppt decline in the underemployment rate from Q1 to Q4. However, at 8.4% it is still a historically elevated level.”

TD Securities

“January is seasonally a weak month for employment as seasonal jobs are no longer required, but this is adequately captured by the seasonal adjustment process. We look for +20k jobs for January, and with an unchanged participation rate of 65.6% leaves the unemployment rate at 5.0% (mkt +15k and +5.0%).”

“An average monthly addition of +20k/m leaves the unemployment rate steady at 5%, which is the RBA’s expectation. The Bank's downside risks will be exacerbated if the unemployment rate starts to creep towards 6% again.”