Omicron gives uncertainty to Australian employment data in January


Economists feel some uncertainty in key labor data for January as the unknown impact of the outbreak of the Omicron COVID-19 variant has hit economic indicators.

After the 2021 blockade of the Delta variant, the employment market has recovered strongly and the unemployment rate has fallen to 4.2%, the lowest in 13 years. Nevertheless, economists believe that there are still several ways to go before the unemployment rate reaches the levels predicted by the authorities.

There is also concern that workforce data could be distorted by Australians who despair and give up looking for a job when faced with an outbreak of Omicron.

The federal government and the Reserve Bank of Australia (RBA) predict that the unemployment rate will fall below 4% in 2022. This is a record that has not been observed for about 50 years.

The Australian Bureau of Statistics will release the January Labor Force Report on February 17th. This report contains important data such as the number of employees and the labor force participation rate. This is an economic indicator that measures the percentage of people who are working or actively seeking employment.

It’s unclear if people stopped looking for jobs when the Omicron variant emerged earlier this year, which could reduce labor force participation.

Even if January’s employment data are more restrained than last month, economists are worried that a decline in the labor force participation rate could lead to a further decline in the unemployment rate.

Most economic forecasts predict that the unemployment rate will drop to just 4.1%. However, the actual numbers have different expectations and vary between 4 and 4.4 percent.

Many economists also expect employment to be stagnant or unchanged, but expectations range from a decline in employment of 60,000 to an increase of 59,000.

On February 15, RBA released the minutes of its February board meeting, maintaining its cash rate at a record low of 0.1%. Bond purchase program It’s worth $ 350 billion ($ 249 billion).

Epoch Times Photo
Governor of the Reserve Bank of Australia, Philip Lowe, will address the National Press Club at the Fullerton Hotel in Sydney, Australia, on February 2, 2022. (Lisa Marie Williams / Getty Images)

Nonetheless, the minutes are something newer than the recent RBA quarterly statement on monetary policy, Governor Philip Lowe’s speech at the National Press Club, and the information economists got from his appearance in the House of Representatives. There is a question as to whether to reveal. February 11th Economic Committee.

In a hearing on February 11, Rowe said it was plausible to raise the cash rate in 2022 as the economy witnessed rising inflation and a declining unemployment rate.

But he warned the Commission that if the RBA pushed cash rates too early, economic recovery would be at risk.

In addition, Treasury Secretary Steven Kennedy will present his department’s views on the economic outlook at a hearing held by the Senate’s Economic Committee on February 16.

Meanwhile, financial markets expect the opening price of Australian stocks on February 14 to be weak after a plunge in Wall Street stocks on February 11 due to heightened tensions between Ukraine and Russia.

Australian Prime Minister Scott Morrison warned the public on February 13 that the situation was deteriorating and approaching a dangerous stage.

In the face of heightened tensions, the federal government ordered the evacuation of the Australian Embassy in Kiev.

In the United States on February 11, major stock market indexes suffered losses. Specifically, the Dow Jones Industrial Average fell 1.43% to 34,738.06 points, the S & P 500 fell 1.9% and then closed at 4,418.64, and the Nasdaq Composite Index fell 2.78% to finish at 13,791.15.

Similarly, Australian stock futures fell 33 points (0.46%) to 7,075.

On February 11, Australia’s Benchmark S & P / ASX200 Index fell 71.2 points (0.98%) to close at 7217.3 points.

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Alfred Bui is a Melbourne-based Australian reporter with a focus on local and business news. He is a former small business owner and holds two master’s degrees in business and business law. Contact him at [email protected]

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