Australia’s unemployment rate jumps to 4.5% in ‘tentative signs labour market is buckling’

Australia’s unemployment rate has jumped to 4.5% in April to reach the highest in about four-and-half-years, amid fears rising interest rates and the global oil crisis will smash economic growth. The number of employed people unexpectedly fell by 18,600 in the month – the first decline this year – dragging the jobless rate up from 4.3%, according to the Australian Bureau of Statistics. The surprise rise in unemployment will provide the Reserve Bank with more reason to hold off on a fourth rate hike at its next meeting in June, as central bank officials juggle worries about spiking inflation and the slowing economy. David Bassanese, the chief economist at Betashares, said there were “tentative signs suggesting the labour market is buckling”. “Of course, whether the RBA raises rates again depends on inflation outcomes and whether the labour market weakness evident in April was merely a quirky one-off or part of a softening trend,” Bassanese said. Graph titled: Jobless rate highest since late 2021 The jobless measure remains below pre-pandemic levels of more than 5%, but has been drifting higher since a near 50-year low of 3.4% in late 2022. Last week’s budget forecast that unemployment would peak at 4.5% by the middle of this year, although Treasury warned that it could reach 5% in a scenario where a more severe Middle East crisis pushes oil prices towards $US200 a barrel. …