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The Australian Bureau of Statistics (ABS) has released data indicating that the unemployment rate held steady at 4.1% in January, defying analysts’ forecasts of a slight increase to 4.2%.
According to Sean Crick, the head of labour statistics at ABS, there was an increase of 18,000 in the number of employed individuals. This increase was driven by a rise in full-time employment, which saw an uptick of 50,000 people, though it was partially offset by a decrease of 33,000 in part-time jobs.
The participation rate stood at 66.7%, which is 0.6 percentage points lower than the record high witnessed in January 2025.
There was a slight uptick in the underemployment rate, which increased by 0.2 percentage points to reach 5.9% in January. The underutilization rate mirrored this trend, also rising by 0.2 percentage points to hit 10.0%.
Youth underemployment saw a more pronounced increase, climbing 1.0 percentage point to 14.8%. This rise nearly erased the decrease recorded in the previous month.
The RBA’s monetary policy board next meets in mid-March, where it is considered likely to keep the cash rate on hold at 3.85 per cent.
“For the RBA, the message is clear: the labour market remains firm,” Oxford Economics head of economic research Harry Murphy Cruise said.
“On its own, this strength doesn’t justify additional tightening beyond the hike we expect in May.
“But if we find ourselves with a lineball decision later in the year, ongoing resilience in employment and wages could be the deciding factor that tips the board toward further tightening.”
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