Australia's Unemployment Rate Rises Slightly to 4.0% in December

January 16, 2025 — Australia's seasonally adjusted unemployment rate edged up by 0.1 percentage point to 4.0 per cent in December 2024, according to data released today by the Australian Bureau of Statistics (ABS).

Despite the slight increase in unemployment, the ABS reported positive growth in employment, with 56,000 new jobs created. This increase in employment, coupled with a rise of 10,000 in the number of unemployed individuals, contributed to the overall rise in the unemployment rate.

Bjorn Jarvis, ABS head of labour statistics, highlighted the strong performance of the employment-to-population ratio, which reached a record high of 64.5 per cent. This figure represents a 0.1 percentage point increase from the previous month, 0.5 percentage points higher than a year ago, and 2.3 percentage points higher than pre-pandemic levels.

"The number of employed people grew by 0.4 per cent in December 2024, slightly higher than the average monthly rise of 0.3 per cent during 2024. It was also higher than the average monthly population growth of 0.2 per cent over the year," Mr. Jarvis said.

The participation rate, which measures the proportion of the population either employed or actively seeking employment, also reached a record high of 67.1 per cent, a 0.2 percentage point increase from the previous month.

Youth Underemployment Shows Positive Trend

The youth underemployment rate (for 15-24 year olds) remains higher than the overall population, at 14.1 per cent in December. However, this figure is significantly lower than the 19.1 per cent recorded in March 2020. Mr. Jarvis noted a recent reversal in the youth underemployment rate for men, which had been rising from mid-2022 to late 2023 but has since returned to late 2022 levels.

Overall Labour Market Remains Strong

Despite the slight uptick in the unemployment rate, the data suggests a robust labour market with record high participation and employment-to-population ratios. The underemployment rate has also shown a positive trend, declining to levels seen in late 2022.

Mr. Jarvis summarised, “While the unemployment rate has barely changed since last December, rising by around 0.1 per cent, other key measures returned to highs and lows during 2024. Since December 2023, the employment-to-population ratio and participation rate have both increased back to record highs… The underemployment rate… has fallen over late 2024 to 6.0 per cent in December, around the recent low seen during the second half of 2022.”

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