On November 12, the Australian Bureau of Statistics (ABS) released labour force figures for October that showed unemployment had increased by 11,100 to 690,000 people. At the same time, monthly aggregate hours worked fell by 1.9 million hours (to 1521.1 million hours) from September.
While unemployment increased in October, the number of people in work also increased. An estimated 24,500 new jobs were created, said the ABS (21,500 of these new jobs were part time).
The fact that more people have joined the workforce than new jobs created, meant that an extra 11,100 people became unemployed.
Reading the mainstream media, however, you could be forgiven for thinking unemployment actually fell in October.
"The Australian economy's resilience continues to surprise", trumpeted the November 12 Australian. "The 24,500 job gain in October, just reported, and the slight rise in the jobless rate to 5.8 per cent is another strong result which will encourage the Reserve Bank to keep lifting interest rates."
Big-business economist Adam Carr told the November 12 Sydney Morning Herald: "We can pretty much say with a greater degree of confidence that we're at the peak of the unemployment rate. Or extremely close to it."
Financial economists are positively howling for the Reserve Bank of Australia (RBA) to increase official interest rates again when it meets on December 1 — even with unemployment rising.
The SMH report that 4cast economist Michael Turner said: "Two consecutive months of job gains are very difficult to ignore and now represent one less hurdle the RBA has to worry about before what we see as a likely rise in December."
But amid the financial hyperbole, there is growing evidence that the "recovery" may be losing steam, as interest rates are increased and government fiscal stimulus payments are withdrawn.
The Performance Manufacturing Index for October, released by the Australian Industry Group on November 2, fell by 0.3 points from its September level, to 51.7. AIG CEO Heather Ridout said: "The recovery in manufacturing activity remains tentative, with exports still soft, policy stimulus easing and unemployment expected to temper consumer demand."
The Australian Performance of Construction Index for October, released on November 6, also showed minimal growth and that "the pace of growth remains subdued and patchy across the [construction] industry", said AIG spokesperson Peter Burn. "This reflects the ongoing tightness of credit conditions, fewer new orders and excess capacity."
The Australian Chamber of Commerce and Industry (ACCI), representing 350,000 businesses across Australia, also warned against over-optimism.
A November 12 statement from the ACCI's Greg Evans said: "The evidence of a convincing economic recovery, while firming, is far from definitive and the economy may face further challenges in the near-term. Today's [unemployment] result adds to the view that strength in the economy is still more forecast than real."
With the federal government's fiscal stimulus running thin, and the ABS reporting wage increases running at only 3.4% for the year to September 30, consumers are expecting to spend less on Christmas than last year.
The November 16 SMH said: "About 35 per cent of households polled said they expect to spend less this year compared to last, according to the November Westpac-Melbourne Institute reading of consumer sentiment."
Lower retail sales in the lead-up to Christmas could reverse some of the employment boost generated, as millions of people already spent their federal government stimulus cheques, sent to parents and pensioners in December 2008 and workers in May this year. A rise in unemployment and a further blunting of the "recovery" could be the result.
"The employment growth hailed by the business and media commentators as being 'strong' is about as tepid as you could imagine", Bill Mitchell, director of the Centre for Full Employment and Equity at Newcastle University, wrote on Bilbo.economicoutlook.net/blog on November 12.
"Over the last two months … total employment rose by 64.3 thousand (net) but 44.1 thousand of that net rise was part-time with declining hours of work on offer. So, I don't consider this to be a booming or even strong labour market and certainly does not in my view justify a rise in interest rates."
Mitchell said labour underutilisation (underemployment) also rose in October. "The ABS data also shows that total labour underutilisation rose by nearly 1 percent in the last month for 35-44-year-olds, the age cohort that is likely to be carrying a significant proportion of the household debt burden.
"Similarly for older workers their circumstances declined dramatically over the last month."
Paradoxically, at the same time that underemployment is growing, so is over-work, said the Australia Institute's report, Something for Nothing: Unpaid Overtime in Australia, released on November 18.
"Australians work the longest hours in the western world", Something for Nothing said. "Whereas the average for full-time employees in developed countries is 41 hours a week, in Australia it is 44 hours.
"Across the workforce, there are 2.14 billion hours of unpaid overtime worked each year — three times as many hours as Australians volunteer to community organisations. This corresponds to 1.16 million full-time jobs, making overwork a natural target for any government seeking to reduce unemployment."
On average, all workers in Australia give the boss 70 minutes a day of unpaid overtime, the report said.
However, "Workers doing unpaid overtime reported working an additional one hour and 59 minutes a day unpaid on average … Put another way, the typical full-time worker donates 33 eight-hour days a year (or six and a half standard working weeks) by doing unpaid work.
"The economic value of unpaid overtime is enormous", the report said. "If each hour of work is worth $33.70, workers are forgoing a total of $72.21 billion in wages, or 6.01 per cent of GDP. This constitutes a direct subsidy to employers by ordinary workers."
Whichever way you look at it, the "recovery" is leaving working people behind. Whether they're unemployed or underemployed and want more hours, or slaving doing unpaid overtime hours for the boss, Australian workers are being made to pay.
Meanwhile, the CEOs of the big four banks shared $36 million in salary and bonuses between them last year, said the November 17 SMH. No wonder they're pushing for the RBA to increase rates — and their profit margins — again.