Surprise surge in employment, but met by labour supply

Taylor Nugent | Markets Research

Key points

• Employment surged +76k in June, well above our and consensus expectations for +15k
• But it was alongside a jump in the participation rate. The unemployment rate remained at 4.4%, as expected.
• The rise in participation and underemployment could suggest a labour supply response to recent cost of living challenges.
• The unemployment rate averaged 4.4% in Q2, above the RBA’s May SoMP forecast of 4.2%. But stronger employment growth in the quarter muddies the signal for their assessment of labour market tightness.

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