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Unemployment rate to stay steady

Reported by AAP
Wednesday, May 8, 2013
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Macquarie
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Australia's unemployment rate is expected to have remained steady in April, but is likely to move higher over the next six months.

AAP's survey of 14 economists, reveals a median forecast for the unemployment rate to have remained steady at 5.6 per cent in April, with total employment growing by 11,000.

The participation rate, the percentage of the working age population either employed or looking for a job is expected to remain flat at 65.1 per cent.

The Australian Bureau of Statistics will release official labour force figures for April on Thursday.

Bank of America Merrill Lynch Australia chief economist Saul Eslake expects the figures to show modest jobs growth, partly to compensate for the sharp fall in employment in March.

Total employment fell 36,000 in March, which pushed the unemployment rate up 0.2 percentage points.

But he said the unemployment rate was likely to increase over the coming months, due in part to the impact of the persistently high Australian dollar.

"As firms start to lift productivity in response to the view that the exchange rate will stay higher for longer, that will result in a gradual trend upwards in unemployment," he said.

Macquarie economist Gabby Hajj expects the unemployment rate to rise to 5.7 per cent in May before moving above six per cent by the end of 2013.

He said the slowdown in growth in the mining sector would hurt employment, and other parts of the economy were not performing well enough to offset that weakness.

"Over the past couple of years the resource sector has been responsible for almost all employment growth in Australia," he said.

"Now that's gone as an engine of demand for labour, the other sectors really have to step up to keep that rate of growth going but it just doesn't look like that's happening."

21/10/2014 14:45Sydney, Australia. 21 October,2014
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