Australian Bureau of Statistics figures released today show WA’s unemployment rate now stands at 5.8 per cent.
Camera IconAustralian Bureau of Statistics figures released today show WA’s unemployment rate now stands at 5.8 per cent. Credit: PeopleImages.com/Getty Images

Honeymoon over for WA jobs as unemployment hits six-month high

Sarah IsonPerthNow

WA’s jobless rate has soared back to levels not seen in six months, with an increase in January unemployment across the State doubling the national rise of 0.2 per cent.

The disappointing result follows December’s seasonally adjusted figure of 5.4 per cent, the lowest unemployment rate achieved in WA since July 2017.

Australian Bureau of Statistics figures released today show WA’s unemployment rate now stands at 5.8 per cent.

The rate plateaued at 5.7 per cent between September and November last year, down from 5.8 per cent in August and 5.9 per cent in June.

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Nationally, the seasonally adjusted unemployment rate jumped 0.2 per cent in January, rising from 5.1 to 5.3 per cent.

There was an increase of 46,200 people in full-time employment and a decrease of 32,700 people in part-time jobs — a net change of 13,500 — with the bushfires and coronavirus impacting the economy over the month.

Over the 12 months to January, full-time jobs rose by 143,900, while part-time employment increased by 103,500 people.

The largest increases in employment were recorded in WA (up 6700), Victoria (up 2900) and Queensland (up 2800), while the largest drop was in NSW (down 1500).

However, the jobless rate increased by 0.6 in Queensland (6.3 per cent) and 0.4 in both Victoria (5.4 per cent) and Tasmania (5.9 per cent).

South Australia saw a 0.5 percentage point dip in unemployment to 5.7 per cent.

Economists are predicting further increases in the unemployment rate and a subsequent interest rate cut in coming months.

“Along with yesterday’s meagre wage growth print, this data shows that there is still plenty of spare capacity in the labour market,” BIS Oxford Economics senior economist Sean Langcake said.

Mr Langcake expects jobs growth to lose momentum over 2020 and slow to less than 2 per cent.

“This will make it challenging to work through existing spare capacity, and we expect the RBA will cut rates in the first half of the year to aid this transition,” he said.

Capital Economics’ Ben Udy said the January data alone probably would not convince the Reserve Bank that a cut was necessary, but he too predicted unemployment would continue to rise.

“If we are right we think that will be enough to convince the RBA to cut rates by 25 basis points in April and July,” he said.

ABS chief economist Bruce Hockman said underemployment also continued to be an issue across the country.

“The underemployment rate continues to remain high,” he said. “But is still below the levels from 2016-17.”

The underemployment rate – which measures the number of people in need of more work than they currently have — increased 0.2 points over the past year to 8.5 per cent.